Why digital wallets are winning over consumers in 2024

Digital wallets have become a frontrunner in payment solutions worldwide in recent years thanks to their convenience, security, and speed.

Airwallex’s recent Cross-border eCommerce report shows just how big this trend has become: 37% of Aussies, 33% of Brits, and 27% of Americans now prefer using digital wallets like Apple Pay, Google Pay, and PayPal. 

The shift is even more impressive in China, where nearly half the population (48%) opts for digital wallets, including local favourites like Alipay and WeChat Pay. 

Cards are being added to mobile wallets in unprecedented numbers in Australia, and the volume and value of transactions powered by digital wallets have increased dramatically in recent years.

According to the Australian Banking Association, between 2018 and 2022:

• Cards registered to mobile wallets rose from just over two million to 15.3 million – a 760% increase. 

• The value of mobile wallet transactions jumped from $746 million to $93 billion – a 12,400% increase.

• The number of mobile wallet transactions rose from 29.2 million to 2.4 billion – an 8,200% increase.

This growing preference highlights just how important ease, security, and efficiency of payments have become. Whether you're shopping online or paying at a store, digital wallets are becoming the go-to choice for a smoother, hassle-free experience.

Which are the top digital wallet providers?

In a recent Statista survey, respondents were given a list of contactless payment brands and asked which they had used in the past 12 months to pay in stores, restaurants or other points of sale with their mobile device. The top 10 brands cited were:

1. Apple Pay - 52%

2. Afterpay - 32%

3. PayPal - 31%

4. Google Pay -26%

5. Commbank Tap and Pay - 21%

6. ANZ Tap and Pay - 15%

7. ZipPay - 15%

8. Alipay - 9%

9. Bank Australia Tap and Pay - 9%

10. Samsung Pay - 8%

While the uptake of digital wallets was accelerated by Covid, making people reluctant to handle cash or cards, the adoption rates highlight a deeper, more lasting preference for the ease and convenience digital wallets offer. 

Most importantly, the numbers reveal how mobile devices have evolved into all-in-one "life management tools," effortlessly managing banking, and payments, along with a wide array of our other personal tasks and obligations.

The crucial role of digital wallets for eCommerce success

Digital wallet payment options have now become crucial for eCommerce businesses aiming to stay competitive and meet consumer expectations. By integrating digital wallets into their point-of-sale process, eCommerce businesses can cater to a broader audience, including tech-savvy millennials and Gen Z shoppers, who are more inclined to use modern payment methods.

Ultimate convenience and enhanced shopping experience

Digital wallets offer the ultimate convenience, allowing customers to make purchases with just a few taps on their mobile devices. This ease of use can significantly enhance the shopping experience, leading to higher customer satisfaction and increased conversion rates.

Streamlined checkout process

What’s more, digital wallets streamline the checkout process, reducing cart abandonment rates. The quicker and more seamless the transaction, the less likely customers are to abandon their carts during a slow or stressful checkout experience. This efficiency not only improves customer satisfaction but also boosts the overall sales and revenue for the business.

Advanced security features

Security is another vital reason for adopting digital wallets. These payment methods often come with advanced features like encryption and tokenisation that protect sensitive customer data and reduce the risk of fraud. By offering secure payment options, eCommerce businesses can build trust and foster long-term loyalty among their customer base.

Reflecting a shift in consumer behaviour

Digital wallets aren’t just a trend – they reflect a broader shift in consumer behaviour. With a significant portion of consumers globally preferring to transact using a digital wallet, businesses that don’t offer these options risk losing out on a growing segment of the market.

Boosting revenue through increased spending

If those reasons aren’t sufficient evidence of the power of digital payments, it’s also been found that consumers spend over 30% more on retail and grocery products when using digital wallets, making them an important source of revenue-building for retailers.

Positioning for success

Ultimately, eCommerce businesses that embrace digital wallets position themselves for success in a rapidly evolving market. By prioritising convenience, security, and customer satisfaction, they can attract and retain more customers, ultimately driving growth and profitability.

Accept payments effortlessly with Airwallex

Creating a global, multi-currency account with Airwallex allows you to easily and seamlessly accept payments for your business from customers worldwide via their preferred payment methods, with no coding required. 

The benefits of using Airwallex as your payment processing provider:

• Easily integrate with popular eCommerce platforms (like Shopify and WooCommerce) or create shareable Payment Links in just minutes.

• Increase conversions with local payment methods by allowing customers to pay using their preferred payment method, from global cards to popular local non-card options.

• Get competitive interbank rates and minimise unnecessary FX fees so you can improve your profit margins and free up funds to grow your business.

• Streamline your financial operations through integrations with Xero and other leading accounting software.

• Provide customers with a secure and reliable way to pay. With over 60 security licenses and permits globally, we meet the highest international security measures and local requirements.

Airwallex supports global payments and finances for over 100,000 businesses just like these, allowing them to manage global finances and grow without limits.

Get started today by opening a business account.

Disclaimer: This information doesn’t take into account your objectives, financial situation, or needs. If you are a customer of Airwallex Pty Ltd (AFSL No. 487221) it is important for you to read the Product Disclosure Statement (PDS) for the Direct Services, which is available here.