Burning a hole in your pocket: The digital wallet wars heat up

You may be familiar with the experience of having cash “burn a hole in your pocket.” Well, it’s not just cash anymore – or credit cards, either. Digital wallets can also do damage to your wardrobe. And things are going to keep heating up.

Visa enters the fray

After shutting down Rightcliq, which it launched last year, Visa has just announced its entry (or reentry) into the wallet wars with V.me.

V.me is taking digital wallets in a different direction by storing payment information remotely – and securely – instead of on the phone itself, which is good because you stand a much better chance of losing your phone than you do of having your account hacked. Visa is promising bank-level encryption and multi-layer authentication.

Visa’s efforts may signal the start of a shift away from phone-based apps to mobile web-based technology, such as we’ve seen with cloud computing. The company already has several technologies in place that should allow it to successfully combine the reliability of its network with digital wallet functionality.

Another V.me advantage is that card information will never be shared with sellers. Remember the old days when you left an imprint of your credit card in the hands of a complete stranger every time you used it, along with your signature?

What Visa offers

Visa brings a lot to the table. It already has one of the world’s largest and most advanced processing networks. V.me will seamlessly integrate vendors into that network to provide simple, reliable checkout and payment solutions.

Vendors using V.me will have access to a single, integrated, online dashboard, allowing them to track V.me transactions, individual charge activity, transactions by day and month, purchases by category, and average and total revenue.

Visa’s future plans

In a combination of visionary thinking and playing catch-up (just a bit), Visa is also developing big things for the future:

  • Person-to-person transactions through a credit card
  • The ability to keep multiple cards consolidated in a single V.me account
  • Support for MasterCard, American Express and Discover cards, all through a single V.me portal
  • Integration of targeted offers, smart subscriptions, and flexible payment solutions


But Visa is not alone in the field.

  • The Google Wallet mobile app securely stores credit card information and offers on a smart phone and offers both in-store and online purchasing options.
  • PayPal, a unit of eBay Inc., launched X.com, which offers many of the same features as Google Wallet and V.me.
  • In 2011, Amex introduced Serve, their version of a digital wallet that allows customers to fund a prepaid account. It later expanded its capabilities through a partnership with Payfone Inc.


While I’m usually hesitant to look too far into the future, I’m willing to go out on a limb on a couple things:

The concept (at least) of cloud computing will continue to grow. Mobile devices will no longer store personal information, but will access it through highly secure networks – such as the one Visa has in place.

Smart phones will be ubiquitous and usage will continue to grow as long as there’s someone around to say, “There’s an app for that.” Mobile devices will be used for more and more activities, from watching streaming video to managing financial transactions, with complete security.

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