The Rise of Digital Wallets

December 12, 2019 Eve Heidemann

Why Charities Should Embrace the Age of the Digital Wallet

According to Australia’s foremost financial analysts, digital wallets are the payment method of the future. ANZ predicts smartphone payments will overtake plastic within a decade, while Westpac even predicts the total disappearance of cash by 2022. With its potential to make donating a simpler, faster and more seamless experience, this represents a huge opportunity for the nonprofit industry. Here’s why you should be getting on board with the trend - and how.

So what are digital wallets anyway?

Paypal introduced consumers to the concept almost a decade ago when it launched its online payment service that allowed users to transfer and receive money without the need for entering credit card or bank account details multiple times. It also offered peace-of-mind in a world fraught with anxieties around online security and credit card fraud as it neatly side-stepped the issue of sharing your financial details with third parties Fast-forward nearly ten years and the ubiquity of smartphones has evolved the concept even further, with the big smartphone players launching their own digital payment platforms (think Apple Pay, Android Pay, Samsung Pay) and a slew of retailers rushing to make the technology available to consumers at the till. Couple that with the fact that contactless payment using our credit cards is now commonplace and you can see why experts believe we are at a crucial tipping point.

Australians are early digital adopters

Australians have always been quick to embrace digital tech - in fact, one recent study placed us third in a global list of countries adopting rapid digitisation, ahead of Japan and the UK[1].  The statistics tell a similar story: over 6 million Australians (a quarter of the population) have active Paypal accounts, while we also have one of world’s highest and fastest growing contactless payment adoption rates. In 2016, contactless accounted for almost 40 per cent of all retail transactions (including cash), compared to around 10 per cent just three years previously[2]. All of this indicates that Aussie consumers are more comfortable than ever with this kind of technology. Here are five reasons why there’s never been a better time for charities to jump on the digital wallet gravy train.

1. Digital wallets make donating a faster, smoother experience.

Nobody wants to spend valuable minutes tapping in their credit card and contact details over and over again.  The most obvious benefit of the digital wallet is that it reduces the time and number of steps required to make a donation, thus reducing the risk of people being interrupted and abandoning their task or getting data entry fatigue.

2. Supporters can donate anywhere, any time.

Digital wallets remove many of the barriers stopping people from using their phones for digital transactions by making it substantially easier for supporters to donate via this method. This instantly improves conversion as it encourages supporters to donate at the moment of inspiration, rather than later via their laptop or credit card.

3. Digital transactions enable better data-gathering.

Cash donations are difficult to track, but digital payments can be monitored, providing charities with plenty of opportunities to gather data on who’s donating as well as when and how much, all of which can inform your fundraising strategy.

4. Security is stronger.

Supporters can rest assured that their details aren’t being shared with any unknown third parties, which makes them more likely to donate via this method.

5. The digital natives of today are the donors of tomorrow.

While older generations may still prefer to donate via more traditional methods, younger donors are much more likely to donate using digital technology because it’s second nature to them. Embedding digital wallet payments into your organisation now will help to attract younger donors and grow the next generation of supporters.   If you’d like to learn more about Everydayhero’s online donation facility and how you can link it to your website’s ‘donate' button, simply get in touch.  

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