Mobile wallets and credit cards: How do they work together? | Mint

In changing financial scenarios, mobile wallets are a new addition. You can link your credit card to a mobile wallet to avoid carrying a physical card every time you make a purchase.

What is a mobile wallet?

A mobile wallet is a digital version of your physical wallet that enables you to make expenses easily. It is an electronic wallet where you can add money for purchases. It acts as a replacement for a physical credit card, where you can make payments just with a tap.

How does a mobile wallet work?

A mobile wallet uses Near Field Communication technology (NFC) to store your card details digitally. The details are encoded, which provides added security compared to a traditional credit card. It also contains various coupons, offers and personal details of the user.

What is the process of using a mobile wallet?

Step 1: Go to your mobile wallet website or app.

Step 2: Add your credit card information on your mobile wallet website or app.

Step 3: When you add your details, the mobile wallet entity will verify your phone number and email address.

Step 4: Whenever you make a purchase, select your mobile wallet option to make payments online.

Step 5: For offline transactions, you will have to either tap or wave your device at the NFC coded machine.

Step 6: You will be required to provide a PIN or biometric authentication to complete the transaction.

Drawbacks of using a mobile wallet

• Acceptance issues: Mobile wallets have limited acceptance as some brands or sellers may not accept it as a mode of payment.
• Internet required: Every time when you make a purchase through mobile wallets, you will require an internet connection and a charged device. In case, you do not have any one of them, you will not be able to make payments.

3. Security and privacy issues: Since the mobile wallet is technologically dependent, it is prone to cyberattacks and fraud affecting your finances. In case you observe any unusual transaction through your mobile wallet, report to your bank or credit card issuing company.

4. Fees: Certain mobile wallet companies might charge for a particular type of transaction, such as international transactions or funds transfers. It is advised to check such fees from your mobile wallet company, as they may differ from one entity to another.

In conclusion, mobile wallets may seem like the future of credit card payments in India, however, you must not be swayed by convenience and quickness to make purchases. Always be mindful of your expenses and get a mobile wallet only if you plan to make most of your purchases through it.