Recently, American Express announced its new digital payment platform, called Serve. This puts the third-largest payment network in the forefront of electronic wallets, along with other payment networks such as Visa and PayPal. MasterCard and Citigroup are also planning to join this trend. There are reports that they will join forces with Google for a similar smartphone payment service.
An e-wallet gives consumers a new payment option. Normally, customers need to confirm their credentials, such as credit card numbers and mailing addresses, when purchasing online.
But with an e-wallet (such as AmEx’s Serve), you can buy online without submitting payment credentials. E-wallet users can also send and receive money. All this can be done through their iPhone or Android smart phones.
MasterCard’s proposed e-wallet service has other planned options, such as direct payments using iPhone or Android smartphone. This can be done through contactless card readers. Waving your phone to buy something is now possible.
Finally, you can easily access information online with a computer or a smartphone. No more trips to the bank or the ATM to check your balance.
Credentials are used for credit card protection purposes. And though smart phones are traceable and can be protected by passwords, they can still be stolen.
Unfortunately, an e-wallet can also make it easier to buy on a whim. You need self-control, unless you want to end up with more debt than you can handle.
The e-wallet definitely provides a new way for consumers to buy items without pulling out their wallets for their credit cards.
This is good for banks, since they can provide their customers with more spending incentives. However, this can be a problem for compulsive spenders.
Sign up at the box on the right for more financial options you can use.
SOURCES: http://news.consumerreports.org/money/2011/03/american-express-serve-electronic-online-mobile-payments-paypal-google-smartphones.html, http://www.bloomberg.com/news/2011-03-28/amex-pushing-expansion-challenges-visa-paypal-with-e-wallets.html, http://www.businesswire.com/news/home/20110328005791/en/American-Express-Announces-ServeSM-Generation-Digital-Payment, http://online.wsj.com/article/SB10001424052748703576204576226722412152678.html, http://news.cnet.com/8301-13506_3-20047792-17.html