The FinTech industry is revolutionizing nowadays. And one of the most convenient payment methods today are Electronic Wallets. In this article, we’re sharing more information with you about the advantages and disadvantages of E-Wallets.
To cut it short, and E-Wallet means a virtual wallet for your purchases. It doesn’t exist physically, however, the wallet’s account will keep all your transactions in secure records. Sometimes, it’s called a digital wallet as well. This is the electronic non-existent version of your payment card.
When you’re into making a purchase using the card, you simply put in the card information and authorize the transaction. With an E-Wallet, you just authorize the transaction while this E-Wallet is automatically connected to your debit or credit card to process transactions on your behalf.
Most commonly, Electronic wallets are mobile-based to facilitate transactions, yet you still can use them on your desktop and laptop as well via the web app or the website, or the service provider.
Let’s dig deeper into this topic and speak further about the E-Wallets below.
What is E-Wallet?
Instead of carrying a physical wallet with your card instead, you simply keep an access pass to your E-Wallet using which you can do instant payments or transactions electronically.
PayPal – for example – is considered to be an E-Wallet. You sync your debit/credit card once to your PayPal account. Then, you’re able to use this account to make purchases afterwards with ease or even with a click of a button to authorize the transaction. It’s that simple!
There are several advantages and disadvantages of electronic wallets. In this article, we’re digging deeper into the advantages and disadvantages of E-Wallets so you get enough information to start using E-Wallets.
Advantages of E-Wallets
Let’s start with the advantages of using an E-Wallet. First of all, it’s very very easy and convenient for you to make purchases/transactions. We’re breaking down into more advantages below:
1. Very Convenient
Yes, you don’t need to hold a physical wallet with cards. You simply keep access to your E-Wallet and that’s it. You can then make purchases with a click of a button.
You don’t need anymore to hold a pocket with different cards or even paper money to pay for your purchases. It’s very simple and secures using the E-Wallet. Think of using PayPal for your physical purchases!
2. More Secure
Finally, you won’t be worried about losing your credit/debit card somewhere. or having to call the bank to stop the card from being lost or stolen. With an E-Wallet, you sync your cards once into the system and voila!
While some retailers – especially in Egypt and MENA – are still using the traditional way to pay locally, more and more users are using cards and E-Wallets which will accordingly increase the cashless retailers very soon.
3. Authorization Needed
What’s so awesome about using E-Wallets is that you will be able to authorize every single transaction manually using a PIN number or an OTP to proceed to place your payment.
This gives E-Wallets a security edge over typical cards. You’re also able to use E-Wallets with two-factor-authentication which allows you personally to revise and approve transactions eliminating fraudulent activities or any potential threats.
Disadvantages of E-Wallets
As we’ve spoken about the benefits and advantages, it’s also important to talk about the disadvantages. And one of the major disadvantages of it is that you always have to keep your phone with you!
1. Carrying Mobile All The Time
Without your mobile phone device, you’re not able to use your E-Wallet. This will give it a limitation to using your funds to make seamless transactions.
Consider also carrying a charger all the time shall the mobile phone went out of charge and you need to access it immediately for some reason!
2. Not Available Worldwide
While some retailers and businesses are turning to deal with and accept E-Wallet payments, it’s still not worldwide available. Especially in our countries where cash payment is still a problem for the digital and cashless transformation.
You still need to have alternative ways to pay, otherwise, you may not be able to complete your purchases. Soon enough, the digital transformation will expand to more users.
3. Additional Fees May Apply
Since the E-Wallet is a middle man between your bank and the retailer you’re buying from, additional fees may apply to the transaction you’re processing.
Most probably, transactions are being deducted from the receiver, not the sender. Yet, it is still an additional fee besides the regular bank fees which will add up to the total transaction fees.
Moreover, if you’re doing an international payment on the internet and this requires a currency exchange. There will be multiple fees associated; bank fees, wallet fees, and currency exchange fees.
Examples of Digital Wallets in Egypt
The most popular digital wallet in Egypt that is very commonly used is the (Vodafone Cash). The service is being well-known and widely used among a huge percentage of people in Egypt.
Some other electronic wallets are available in Egypt such as;
- Vodafone Cash
- Etisalat Cash
- Orange Cash
- QNB E-Wallet
- CIB E-Wallet
- NBE E-Wallet
- Alex Bank Ma7fazty
- Banque Misr E-Wallet
We’re dedicating another detailed article about the E-Wallets in Egypt and how to use them. Meanwhile, you can go to the service website and check for more details and information.
E-Wallet and Cardless transactions are the future of online payments in Egypt. While debit/credit cards are seamless enough, mobile payments will be easier to use since everybody is owning one today.
The Central Bank in Egypt is supporting supports the applications of electronic portfolios in Egypt in line with the efforts of the Egyptian government to implement the electronic payment system. With that being said, more and more ideas and development are coming to this sector locally every day.
That was it all about the advantages and disadvantages of E-Wallets in Egypt. We’ve discussed it in detail, but please feel free to leave your comment below for any questions or inquiries. We’re here to help 🙂