Focus on bank’s role in digital wallets gets sharper
It is the second month of 2023, and seemingly everyone wants in on what could be the awakening of banks to digital wallets.
The Mobey Forum, a digital finance association for financial firms wanting more digital revenue, has a new wallet report out, for instance. The mid-depth document boils down to an unsurprising message.
It is up to the sector to be more of a player in digital identity, including playing a substantial role in making digital identity a global fact of life. In fact, forum members say, that is going to be hard without the perceived solidity and sobriety of legacy financial institutions.
These companies are best positioned to trade on their industry’s history of keeping customers in control, for the most part, of the assets they bring in the door. For digital identity to work, “the individual is the true owner of their identity information and controls how this information is managed, stored and consumed.”
David Birch has the religion. Birch, a well-regarded author and commentator on digital financial services, has contributed a piece to Forbes.com about the rise of wallets. In it, he gives a thumbs up to the forum’s report.
Wells Fargo, JPMorgan Chase and Bank of America are coding an online-only digital wallet. It will be operated by Early Warning Services on the Secure Remote Commerce standard. Payment network Zelle is managed by Early Warning.
Based on a global survey by financial services firm FIS, Birch estimates that $2.5 trillion is moving from consumers’ digital wallets to global retailers.
But his overarching theme is that people who should know better only think of wallets as a mode of payment.
Wallets hold ID for purchasing age-regulated goods as well as licenses and credentials. Increasingly, they will communicate with systems and subsystems to ease transactions and fight fraud, something that too often still is an either/or proposition.