Factors to consider developing digital wallet application in 2021

Mobile wallets have become firmly established in the hearts of users. As economies around the world go digital, more and more people are reluctant to pay in cash or frequently enter account and card details. They prefer to leverage present-day advanced technologies and value-added services through the built-in mobile wallet.

We’ve made the purpose of our article to define and outline the key business drivers surrounding the implementation of mobile wallet platforms at both financial and industry-specific companies. In addition, we will explore the global mobile wallet market and the clues of launching the e-wallet right in 2021.


  1. Key points about mobile wallet market
  2. Five business drivers to develop a digital wallet
  3. Data Transfer Technologies used in wallet app development
  4. Customer experience is the key to in-demand mobile wallet
  5. Conclusion
  6. FAQ

Key points about mobile wallet market

  • Mobile wallet (also called e-wallet, digital wallet) is a mobile, web, or omnichannel application that allows customers to securely store credentials for various payment instruments and loyalty programs; send and receive money in a peer-to-peer network (P2P); convenient to pay in the store; make purchases on the Internet; make bank transfers; pay the bills; use value-added services and more.
  • According to the report by Mordor Intelligence, the mobile payments market is expected to reach US $5,399.6 billion by 2026. That is to say, it will grow at a CAGR of 24.5% over the forecast period (2021 – 2026).
  • Based on Statista, the digital payments segment has a global transaction value of US $5.204 billion in 2020 and is the largest segment in FinTech. 
  • According to the E-commerce Foundation, over 25% of consumers make weekly purchases via mobile devices, mostly being carried out through a business’s app or website.
  • Although there are already mobile wallets that gained immense popularity among users, such as Google Pay, Amazon Pay, Paytm, etc., the industry is not saturated yet. Thus, mobile wallet app development is becoming a promising business niche in 2021.

Five business drivers to develop a digital wallet

  1. Digital wallet as an initial tool for customer acquisition

    A digital wallet can exponentially increase a company’s reach without having to invest in expensive conventional infrastructure. It also lowers the cost of customer service and relationship management. Due to seamless self-entry with robust identity verification services and document capture with intelligent AI tools such as OCR (Optical Character Recognition), fully digital customer acquisition occurs in minutes.

    The customer onboarding process varies by industry, location, digital wallet policies and strategies. That is, flexibility in connectivity, customizability of forms and workflows are key criteria when choosing a mobile wallet solution. Once connected, the company can then provide targeted offers and products.

    Image source: unsplash
  2. Value-added services and personalized interactions within wallet’s functionality

    Mobile wallets are a vital tool for offering value-added services and personalized interactions. Study carefully what your client wants and give it to him in wallet functions. The system needs to make the life of your users easier and relieve them of the pains when dealing with ordinary banks.

    For example, personal finance management, reward and cashback programs can boost brand image and turn users into loyal customers. To keep pace with the ever-changing needs and expectations of customers, digital wallet operators must constantly seek innovation and, more importantly, be able to quickly bring new products and services to market.

  3. The tool for expanding merchant’s base

    Merchant acquiring is a key business goal for banks and payment service providers. E-wallets offer more convenient and faster purchases’ opportunities to end customers and increase added value for merchants.

    Through targeted offers, loyalty programs, and in-app or in-store promotions using QR codes, sellers can strengthen customer relationships and achieve customer retention. Access to these marketing tactics encourages merchants to further stimulate the distribution of wallets to their customers.

    QR code payments are another compelling offer for merchants to join the wallet operator’s network as they facilitate mobile payments without the need to purchase expensive POS terminal infrastructure.

  4. Earning the revenue through flexible business models

    There are various business models to get the revenue from owning digital wallet. Most common, the company that owns a digital wallet receives a commission from the respective service provider. In addition, as far as the e-commerce business is concerned, the digital wallet company earns a commission on every sale offering this service. That means that the wallet companies get a commission on the total cost of selling a particular product from a brand or seller. The commission percentage depends on the type of product and ranges from 0% to 20% of the sale price.

    Other ways how digital wallet brings revenue to the company-owner:

    • Charging sellers a monthly fee by providing them with a marketplace platform to showcase their products.
    • By advertising other companies’ services/products on the websites of the wallet companies.
    • Using collaborations where a consumer can navigate from one website to another.
    • If a customer uses a bank debit/credit card on any digital wallet website, the bank pays a specific commission to the wallet operator.
    • Some sellers launch their products exclusively on the websites of the wallet companies and give them a good share of the profits.

      This is just the beginning of the digital wallet as governments and private companies promote and encourage non-cash transactions and provide consumers with the best of digital services. So, the ways of earning new revenue will be constantly expanding.

  5. Enhancing security and preventing fraud

    The related cybersecurity trend obliges mobile wallet developers to reliably protect user data. For this, they use AI-based solutions for cybersecurity, cryptographic information encryption, blockchain technologies, tokenization, and biometric authentication.


    To illustrate, a wallet operator can strategically implement a closed-loop or semi-closed wallet to lower transaction costs and keep funds in their ecosystem. Using contactless payments with QR codes and smartphones can further reduce costs for institutions and merchants by making them independent of card use patterns

Data transfer technologies used in wallet app development

Digital wallets are classified as financial apps, so e-wallet developers use secure methods to process mobile payments. The most popular data transfer technologies leveraged in wallet app development are the following:

Bluetooth and IBeacon technologies

IBeacon technology was developed by Apple and is built into iPhone and iPad running iOS 7. The technology expands the possibilities of geolocation and opens up new possibilities for mobile payments and advertising strategies. 

IBeacon uses Bluetooth low energy wireless technology, which allows devices to connect with each other without having to turn on Wi-Fi or GPS. This way, to be able to make such payments, the client must have a mobile device with enabled Bluetooth and the installed PayPal application. In the settings, the user turns on contactless payment to allow the point of purchase.


NFC is a wireless short-range technology that operates mostly in the specifications of modern smartphones and tablets. The principle of NFC work is similar to Bluetooth, but when connected to another NFC device, you do not need to spend a lot of time on identification. The connection is established almost instantly (a second of time). As a fact,  the speed of payment becomes its distinguishing feature. 

Among other benefits of NFS are:

  • the high level of safety; 
  • no need to have bonus cards with yourself, since the application saves all discounts and accumulated bonuses; 
  • using the application in the bank is free.


QR-code is a two-dimensional or matrix barcode containing information about the object to which it is attached. QR-code becomes a must-have online payment method. Instead of entering card details and personal data, the user scans the code with his phone and makes a payment in a few clicks. Merchants are actively adding this method to their sites, thereby increasing the conversion rates of payments.

Customer experience is the key to in-demand mobile wallet

We’ve found the five business factors to consider launching a digital wallet. Meanwhile, the key and most thoughtful one is to bring New Customer Value to your specific audience segment. 

Today, faced with more choices than ever, consumers are very clear about their needs. And to deliver a top-notch customer experience becomes a more difficult-to-achieve task for companies. In these terms, a digital wallet can be the very clue.

To deliver the valuable e-wallets, we recommend taking into account the following trend principles:

  • Omnichannel. The ability to use the digital wallet in all environments, for example, in a store, online, and in the application. Get the detailed research about omnichannel solutions in our previous article.
  • Particular audience segment. Look for a segment of the audience that large corporations have deprived of their attention. Study the needs and create a product with the highest customer value for this particular segment. Take an example with e-wallet Payeer. The platform focuses on freelancers working with foreign customers. Transfers are available to 127 countries around the world in dozens of different ways. Payeer maintains the anonymity of users, you only need an e-mail address, to which you receive a letter with further instructions.
  • Reach / Scope. Delivering convenience to customers must be a constant process. For instance, no need to re-enter card details. Or the payment method can be used in diverse industries and locations.
  • Personalization and loyalty. Customers want to receive relevant offers from mobile wallets, based on their purchase history, interests, and geolocation. Further, the app should update loyalty schemes and delivery preferences automatically and in real-time.
  • Security. Developers of mobile payments applications must ensure transparency of the security measures and an accurate fraud monitoring system applied to the application when offering them to their customers. 


We hope this article answers at least some of your questions about how to build a mobile digital wallet application for your business. All in all, developing an e-wallet can help your company reach commendable new heights on the market. And in the case of startups, it’s a well-strategic approach to attract clients worldwide. Especially, due to people’s growing reliance on online portals, the e-wallet services are extremely actual in our today’s remote and home times.

When it comes to financial transactions and secure payments, it is highly recommended turning to an experienced mobile app development company. This way, you will ensure leveraging modern technology and security compliance, which can expand your reach in the international market without fear of being digitally tricked.

If you pay attention to all the components, you will get a truly in-demand and competitive product. Create something unique for a specific audience segment – and you can be among leaders in the market. In these terms, the high level of knowledge and support of experienced developers are extremely in need.  The ones who know-how to create the wallet application, make managing your customer finances convenient and lead your business to success. Contact FreySoft to get a free consultation and make the job done in the best way. 


What are digital wallets?

The concept of a digital wallet has emerged as a way to promote secure electronic money transactions, as well as a method to make online shopping more efficient. In other words, a digital wallet, also often referred to as an e-wallet, is a secure online space for storing payment information that an authorized user can access anytime and anywhere. They can be created for both general uses and with a specific web provider.

How much does it cost to develop an e-wallet mobile application?

There are a number of factors that will have an impact on the overall cost of developing an e-wallet mobile app. That includes the complexity of features, tech stack, and scope of work you need for your project. In particular, technologies like AR and some APIs can be quite expensive. The complexity of the design is the second important factor since a more attractive interface takes more time to create as well as the adoption to different screens. Then there is the hourly rate of your outsourcing company and the number of specialists you decide to hire. Typically, the cost of developing an e-commerce application varies approximately from $20,000 to $50,000.

How do you implement a digital wallet? 

Research and identification of the e-wallet core features are the initial steps towards implementing the demanded product. If you’ve done thorough research yourself, you can reduce the time and cost that the development team usually spends on this phase. However, we still recommend that you set aside time for background checks with your application development company, as new information may emerge during negotiations.

After, we need to identify the development process issues, such as which platform the e-wallet will run on, what tech stack, and the talents are involved. After, bringing all details together, the vendor starts the development phase. 

How long does it take to develop a E-wallet app? 

Depending on the size of your project and how far ahead you plan to scale it, developing an e-wallet app can take from a couple of months to a year. Still, if you want to run the app quicker and not sacrifice the quality, you can start by launching a minimum viable product (MVP). It will allow you to test the features and ideas of your e-wallet application, and prioritize those needed for future development. In addition, MVP is an opportunity to start making money while you are still developing your application.

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