Cross-border transactions experience a surge via digital wallets
In the rapidly evolving financial landscape, digital wallets are making significant strides, particularly in Asia and emerging markets. These innovative solutions are revolutionising the way people exchange money, especially for the unbanked and underbanked population.
According to the World Bank's Global Findex database, 1.7 billion adults were unbanked in 2017. Digital wallets are filling this gap, providing a means for these individuals to receive and exchange money without the need for agents or banks. This is particularly beneficial for those who are out of the labour market or live in rural areas, as obtaining traditional bank accounts can be challenging.
Companies like DigiAsia in Indonesia and Xsolla, expanding wallet payment services across Southeast Asia (including Malaysia, Singapore, Thailand, Indonesia, and Japan), are at the forefront of this digital revolution. These companies are likely to offer globally connectable digital wallets, making transactions faster, more accessible, and cheaper than traditional cash and bank transfers.
Moreover, the implementation of payments through QR codes reduces checkout experience friction, making digital wallets an attractive option for both businesses and consumers. This technology is facilitating point-of-sale cross-border transactions, further expanding the reach of digital wallets.
Multi-currency wallets like Airwallex's and WorldFirst's are also playing a crucial role. These wallets enable businesses to exchange payments with foreign partners without the need to create local bank accounts globally. This is a significant advantage for companies looking to expand their operations across borders.
As more players enter the digital wallet space, particularly in Asia and emerging markets, the future looks promising. Smaller players with core customers who would benefit from a digital wallet are also likely to offer their own solutions, further fueling the growth of this sector.
This article was originally written by Valentina Vitali on LinkedIn, highlighting the transformative potential of digital wallets in the financial industry. As we move forward, it's clear that digital wallets are set to become an integral part of our financial lives, making transactions easier, faster, and more accessible for all.
