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A mobile wallet is a type of payment service through which businesses and individuals can receive and send money via mobile devices. It is a form of e-commerce model that is designed to be used with mobile devices due to their convenience and easy access.
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A mobile wallet is also known as mobile money or a mobile money transfer.
Techopedia Explains Mobile Wallet
A mobile wallet primarily enables an individual to pay as well as receive payment using a mobile device. Typically, a mobile wallet is delivered through several payment processing models. This includes, but not limited to:
- Mobile-based billing – A user generally sends/receive payment via their mobile service provider (or in the same invoice).
- SMS-based transactions – The transaction is initiated by sending an SMS short code. In this case the payment can be credited/debited from the configured bank account, credit card or mobile service.
- Mobile web payments – Allows a user to send/receive payments via a mobile app.
- Near-field communications (NFC) – This uses a mobile app and special hardware built in to the mobile device to interact with a payment-processing terminal.
Regardless of the model used, a mobile wallet service is generally delivered by and in collaboration with mobile service providers and banks (or other financial institutions).
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