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What Is An E-Wallet?

Published 29/01/2021

What is an E-Wallet?

An E-Wallet is a form of electronic device that is used to make face-to-face transactions or online payments through a digital device. Also referred to as a digital wallet, e-Wallets are connected to the customer’s bank account and can be used for payments around the world.

Popular e-Wallet providers include Apple Pay, Samsung Pay, Google Wallet, PayPal and more. This form of software can be a part of a bank’s mobile app or part of an online payment platform, such as PayPal. For cryptocurrencies such as Bitcoin, e-Wallets are the sole way for users to make payments and maintain balances. 

Accepting E-Wallet Payments

Also referred to as contactless payments, NFC (Near Field Communication) payments are now used globally. This form of technology allows users to both transmit and receive information through phones over a short range of distance (normally around 4 cm).

Originating from existing Radio Frequency Identification (RFID) technology, NFC payments work when both the payment device and reader are in close range and activated. There is then an exchange of encrypted data that is used to complete the payment through the NFC chips in both devices.

The addition of NFC as a security feature for some digital wallets allow payments only to occur when the user unlocks the app on their device and selects the payment card for use. Transactions are then completed using biometric authentication such a fingerprint and facial ID recognition.

This means unlike usual contactless payments there is not a limit to the amount of spend and allows customers to make only one payment at a time. Major NFC payment applications include Apple Pay, Google Pay and MasterCard PayPass.

For merchants to begin accepting digital wallet payments online, the process is very much similar to making a transaction through a POS terminal. It will not be necessary to make any configuration or integration changes, although merchants will need to initially integrate a payment button to their websites or mobile applications. This will help users identify which forms of payments are supported by your business.

The different types of E-Wallets

There are several types of e-wallets, some of the most common are as follows:


  1. Apple Pay - Apple Pay is an e-wallet that can be used by customers who have Apple devices such as an iPhone or Apple Watch. With this technology, you can make secure contactless payments that are above the current £45 limit in shops and over the internet. Please be aware that you can only pay with Apple Pay at locations that accept this form of payment.

  2. Samsung Pay - Another form of e-wallet, Samsung Pay can be used by customers who use Galaxy devices or other smart watches. You can add both credit and debit cards - if this is not possible, you can add them through the Samsung Pay Card2. Samsung Pay uses user authentication.

  3. PayPal - With the PayPal digital wallet, customers are given the ability to quickly make purchases online, send money, request money as well as buy and sell items on eBay. Users have the option of using either the tap-to-pay NFC PayPal app or the PayPal Mastercard to pay in store. 

  4. Amazon Pay - By using the existing payment information stored on Amazon accounts, customers can use Amazon Pay to make transactions. An added benefit of Amazon Pay is that payments can be made by voice, through Alexa.

  5. Visa Checkout - Visa Checkout is ideal for customers who primarily use Visa cards to make payments. Instead of having to fill out card details with every transaction, customers can log in and choose the Visa card they wish to pay with through Visa Checkout. This speeds up the payment process greatly as it simply requires the user to enter a username and password. Visa Checkout also allows the user to benefit from additional security protection as the payments are taken through the Visa gateway as opposed to each retailer’s website.

  6. Google Pay - Similarly to the other forms of e-Wallets, Google Pay requires the user to add a payment method to the application to use the service. After the debit or credit card is added, customers can pay in stores, online, in apps or send money (US/India only). 

Benefits of Accepting E-Wallet Payments

Digital Wallets can offer a number of advantages to users and merchants. The most significant benefit is that the payment process becomes far quicker and easier, with customers having the ability to make transactions with the simple entry of a password, fingerprint or face ID recognition.

For merchants, a definite benefit of offering e-wallet providers is that the risk of cart abandonment is reduced while general sales increased due to the fast payment processing times. While contactless cards are limited for payments up to the value £45 without pin entry, digital wallets can allow users to make high  value contactless payments in-store. 

Challenges of Accepting E-Wallet Payments

While customers are not charged fees to use e-wallets, merchants may be required to pay certain fees to accept digital wallet payments. Additionally, it may not always be possible for merchants to facilitate digital wallet payments as they may need specific hardware or software to upgrade their existing methods of accepting payments.

With “staged” wallets, also known as digital wallets that require multiple stages to complete the transaction, merchants can expect a transaction fee for Visa staged transactions. However, this only impacts businesses who accept payments from staged wallets such as PayPal, etc. not from accepting Apple Pay, Samsung Pay or any other NFC wallet. 


With millions of users across the world, e-wallets are  undoubtedly the future of payments both online and in store. They can be highly convenient and secure for merchants and customers. If you would like to begin accepting digital wallet payments for your business, you can speak to the Opayo team for further help and advice. 

We offer 24/7 service all year long, with expert help for businesses across the UK and worldwide. Contact us online or call on 0191 313 0299 today. Alternatively, you can download our ebook for additional information.