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Digital Wallet vs Mobile Wallet

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The GoCardless content team comprises a group of subject-matter experts in multiple fields from across GoCardless. The authors and reviewers work in the sales, marketing, legal, and finance departments. All have in-depth knowledge and experience in various aspects of payment scheme technology and the operating rules applicable to each. The team holds expertise in the well-established payment schemes such as UK Direct Debit, the European SEPA scheme, and the US ACH scheme, as well as in schemes operating in Scandinavia, Australia, and New Zealand. See full bio

Last editedDec 20213 min read

On-the-go payments are more convenient than ever, with no need to carry around cards and cash. We can now make payments at home or away using a mobile app, all thanks to digital wallets. But there are many terms out there for this technology. What is a digital wallet, and how does it differ from a mobile wallet? We’ll cover the ins and outs of a digital wallet vs mobile wallet below.

What is the difference between a digital wallet and mobile wallet?

You might also see a digital wallet referred to as an e-wallet, both terms referring to a type of software enabling users to store credit and debit card details and loyalty cards in the cloud. All the users’ card details are stored in one handy place – and because it’s cloud-based, they’re accessible from any connected device.

So, is there a difference between a digital wallet and mobile wallet? A mobile wallet is simply a specific category of digital wallet technology. However, while a digital wallet can be used on any device, a mobile wallet is accessible through a mobile app.

Digital wallets can be used:

To make ecommerce payments online (Example: PayPal)
To transfer money between friends (Example: Beem It)
To make mobile contactless payments (Example: Apple Pay)

Mobile wallets aren’t quite as broad. They’re a type of digital wallet that you use to make contactless payments in place of a credit card or cash. Apple Pay and Samsung Pay are both examples of mobile wallets, accessed through apps downloaded to your smartphone or wearable device. In addition to making payments with a single tap, they can also be loaded up with concert tickets, travel passes, and loyalty cards. Essentially, anything you’d include in a physical wallet.

How to use a digital wallet vs mobile wallet

The first step is choosing a service or downloading an app. If you have an iPhone, iPad, or Apple Watch, you’ll probably want to use Apple Pay. If you have a Samsung device, you’ll find Samsung Pay to be most compatible. Google Pay works with any Android device. Each offers similar features, depending on the type of phone you have. There are also mobile wallets for fitness wearables, including Garmin and Fitbit Pay, both of which are designed to work with your smartwatch.

After downloading the app of your choice, you’ll then link your card details by typing or scanning them in. You’ll be set up to make payments now. When shopping, look for a contactless payment symbol and hold your device next to it. To complete the transaction, you may need to use Face ID, a PIN code, or your fingerprint for security.

Remember, all these examples of mobile wallets fall under the category of digital wallet. You can still reap their benefits without accessing them via a smart device. When you go to checkout from an online store, you can simply enter your wallet’s username and login to access your stored financial details. This bypasses the need to fill out lengthy credit card payment forms – a benefit to merchants and consumers alike.

Security features of digital wallets vs mobile wallets

Mobile or not, digital wallets are designed to be safer than traditional wallets. Physical cards and cash are easy to lose or steal. Your electronic details are password-protected, often with an added biometric layer of security. Mobile wallets also use security features including:

Tokenization to process payments without sharing card numbers – the numbers are encrypted and replaced with a token.
Remote data erasure – if your phone is stolen, Samsung, Apple, and Google all allow you to wipe your mobile wallet data remotely.

The bottom line

There are few differences between digital wallets and mobile wallets. Both store the user’s payment details securely in a central location for easy access. Mobile wallets are simply a type of digital wallet using a smartphone app to make mobile payments. You can set up more than one to use them for online and offline payments.

If you’re a business looking for ways to make payments more efficient, consider using an NFC-enabled card terminal to accept mobile wallet payments. You should also consider taking digital wallet payments on your website by integrating payment buttons for services like Apple Pay, Google Pay, or PayPal. This not only protects your customers’ data, but streamlines the checkout experience for improved conversion rates.

We can help

GoCardless helps you automate payment collection, cutting down on the amount of admin your team needs to deal with when chasing invoices. Find out how GoCardless can help you with ad hoc payments or recurring payments.