IDC defines the wallet, tells banks to focus on identity

IDC defines the wallet, tells banks to focus on identity

09 APR 2013

A new report by IDC argues the term e-wallet should replace current terminology such as digital wallets, mobile wallets or mobile payments.

The research firm says e-wallet can then be sub-divided into remote, proximity and hybrid wallets to reflect usage in point-of-sale transactions, e-commerce and a mix of the two types.

The report also recommends that financial institutions, which fear e-wallets pose a commercial threat, should focus on the core value behind the wallet – digital identity.

“By shifting from an obstruction or controlling strategy to an opportunistic one, financial institutions can generate new revenue streams and provide more value for their customers, regardless of which e-wallet model becomes dominant,” said the report.

IDC suggests banks should develop expertise in analysing transaction data so they can deliver recommendations to consumers and merchants; negotiate with credit card providers for more leeway to set their own prices, so they can develop partnerships on the basis of trade-offs; and attempt to influence consumer behaviour rather than a heavier handed approach of attempting to exert control over it.

“With a clear view of the e-wallet market as heading toward open rather than closed models, the ideal strategy is one that is robust under an open model,” said Aaron McPherson (pictured), IDC’s financial insights practice director, worldwide payment strategies.

Author

Richard Handford

Richard is the editor of Mobile World Live’s money channel and a contributor to the daily news service. He is an experienced technology and business journalist who previously worked as a freelancer for many publications over the last decade including...

Read more

Related

Tags