Will the mobile wallet replace the leather wallet?

Will the leather wallet go the way of the dodo? With mobile wallets and mobile money dominating our landscape, carrying cash seems, well, rather démodé.

Already, 18% of South Africans are using mobile phones to transfer money, and FNB reports that there were 500 000 eWallet holders in April—up from 250 000 in October last year.

The majority of senders (79%) are less than 40, so the techno-savvy generation is creating the future.

World Wide Worx research has indicated that two out of every 10 South Africans is using a cellphone to transfer cash to family and friends, which means that mobile money is one of the fastest growing sectors in the financial-services environment. Yolande van Wyk, CEO of FNB’s eWallet Solutions, says FNB has tracked ATM withdrawals in small towns like Modjadjiskloof in Limpopo and Ngcobo in the Eastern Cape—it’s not just savvy urban users who are embracing technology, but the previously unbanked.

With at least 35-million cellphone users in South Africa, mobile money transfers are convenient. Recipients can also buy prepaid airtime and electricity with cellphones, which makes the proposition even more attractive.

Independent research undertaken by FNB reveals that 68% of eWallet users use the service to send money to people who are financially dependent on them, and 64% of these people send money to relatives who live in a different province. In these cases, money is often required urgently and the instant nature of the eWallet service has clearly contributed to its success.

As trends change, so consumers adopt new technology. But what will remain constant is a security concern. If you lose your phone, you’re as vulnerable as if you lose your wallet, so consumers need to be just as vigilant. Don’t wave your phone around in public, any more than you would your wallet.

Also, remember that some smartphone applications can transmit personal information, so be cautious about storing any sensitive information on your phone. Don’t store your credit card details, for example. And don’t download applications that may be untrustworthy. Choose applications from your bank’s website and reputable sites.

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