In the mid-1990s, internet users began to make their first online purchases. At the time, purchases were basic, including CDs and other digital technology. Interest from consumers in making payments and purchasing goods and services online introduced the idea of a digital wallet.
PayPal emerged in 1999, while Alibaba launched its Alipay platform in China only four years later in 2003. The history of digital wallets is much longer than most people think, especially considering there are many who have yet to set up mobile and online banking platforms.
There is a wide range of reasons to use a mobile wallet, from security to convenience. Even better, the most popular and well-known mobile wallets, such as PayPal and Alipay, are free to use. So, what’s the hang-up when it comes to downloading a digital wallet?
In short, those who aren’t digital natives may be hesitant to enter their sensitive financial information into an online platform. Tapping a smartphone to a payment processor at a convenience store may seem a bit too simple to some or may seem unnecessary to others.
However, the growing popularity of cryptocurrencies has only sped up the development of digital wallets. Capabilities are expanding for business and private accounts, especially as more and more people add a range of currencies (crypto and otherwise) to their accounts.
As one of the first players in the digital wallet game, PayPal has slowly and meticulously built a digital wallet platform after over two decades of incorporating user feedback. The result is a seamless browser platform that allows users to make and accept payments in over 25 currencies worldwide.
PayPal also offers services for small businesses, though its platform is best used for personal use (more on business wallets below).
Similar to PayPal, Alipay is one of the original contributors to digital wallet development. With more than 1 billion users worldwide (according to Alipay) and 80,000 stores using Alipay, it’s a hub for personal and business users.
Alipay uses a unique encryption platform, which adds a layer of security to all transactions. It’s commonly used throughout Asia.
Most digital wallets have shifted to offer some sort of business plan, but those looking to set up an account for their business are better off using a platform built specifically for entrepreneurs. Due came out in 2015 with the purpose of simplifying timekeeping, billing, and payment processing for employers.
Services designed for consumers are free (as with PayPal and Alipay), but platforms designed for businesses charge a commission. One benefit of using Due is that this rate is fixed at 2.8%.
When PayPal purchased Venmo, they decided to develop the app as a mobile-friendly digital wallet. Already, Venmo was popular with younger generations for its simplified platform. Maximum security measures ensure the safety of sensitive information, while the app itself is designed with simplicity and social life in mind.
Keep in mind that Venmo (like PayPal) charges extra for credit card transactions. Venmo is best for small debit card transactions.
Today, there’s a different digital wallet for each type of cryptocurrency. There are some designed for Bitcoin holders, others for those with a range of cryptocurrencies. Several are ideal for those mining and working in crypto hardware, or for those working specifically with Bitcoin in the realm of mining and hardware.
Exodus is best for first-time crypto holders looking to learn the ropes. The platform works for both web browsers and mobile devices and allows users to shift between a variety of cryptocurrencies, from Bitcoin to Ethereum to Litecoin.
However, Exodus is best for beginners only, as it doesn’t use open-source code. This means that it isn’t part of the blockchain network that all cryptocurrency runs on. This is a major concern for some, which is why Exodus remains popular for beginners rather than advanced crypto holders.