This post is an excerpt from an upcoming report entitled The Current and Future State of Digital Wallets, which is being shared here as a 16-part series. To receive a copy of the report, please register here and we will get the current draft sent out immediately and a PDF of the final report when it is ready. This is the ninth post. For the first post click here, for the previous post click here, and for the next post click here.


Current Successes

The majority of successful Digital Wallet implementations reflect single-use scenarios.

  • Crypto Wallets – allow sending and receiving of cryptocurrency.
  • Ticket Apps – many airlines, hotels, and more use a basic Digital Wallet embedded in their applications to show tickets with QR codes and other ways to recognize a simple credential that represents a ticket.
  • Loyalty Cards and Vendor Apps – vendors (e.g. Starbucks) have been very successful in creating credential-based versions of their cards and accounts. Very few, if any, are based on any standards beyond using QR codes for validation.
  • Payment Cards – both the iOS and Android ecosystem have built in payment approaches. The Android “Wallet” (e.g. Google Pay)

More generic Digital Wallets exist, with the most successful being Apple Wallet, Google Pay, and Samsung Pay. It allows storing and display of multiple types of Credentials – though none are standards-based:

  • Payment Cards for Apple Pay
  • Loyalty Cards
  • Tickets/Passes

These more advanced Digital Wallets are beginning to adopt user experience strategies to make them more useful. As an example, travellers are now seeing that their boarding passes are showing on the lock screen. This is usually based on a time value and is a mediocre experience at best. Other strategies such as integration with location-based information, NFC and similar approaches will help here.

Where Are Things Working (and Failing) Now?

Considering the Digital Wallet space is over twenty years old, it has had very few solid successes. Such a fact needs to be considered by any organization or person that intends to build a business bases on a Digital Wallet at its core.

Let’s examine the current areas where Digital Wallets are working and discuss, at a high-level, how well they are working.

  • Payments are increasingly popular though still a very small market with less than 3% of eligible transactions. Apple clearly has the financial capacity to play the long game here and we can expect it to continue.
  • Loyalty Cards are being used well in Digital Wallets. They are simple and don’t have a lot of features but they make it easy to stop carrying numerous loyalty cards from vendors. That being said, your author still uses the Starbucks App to pay for things even though he could use the loyalty card in his Apple Wallet.
  • Tickets have been used successfully by various airlines, movie theaters, and other apps (e.g. Meetup). The easy ability to find a ticket in your phone’s Digital Wallet has clear benefits for people. There are still issues though – finding the ticket is hard if you have more than a few items in your wallet and getting rid of the old tickets is typically manual.
  • Cryptocurrency Wallets have partially succeeded. They have taught people that digital assets can be secured. The amazing number of failures also provides a warning that the technology isn’t everything and even that technology isn’t as mature as it needs to be.

There are far more areas where the idea of a Digital Wallet is simply failing. These failures are partially due to the immaturity of technology but even more due to a misguided belief that technology alone is the solution. The list of areas of failure could take pages, so let’s just look at a few examples:

  • Cryptocurrency Thefts – there are weekly stories about personal and institutional cryptocurrency thefts. These failures are due to faulty processes (e.g. number porting process failures), personal “security hygiene” failures, and insecure cryptocurrency wallets. These failures temper market demand by creating anchors for fear, uncertainty, and doubt.
  • Innovators Only – Apple Pay is used in only 3% of eligible transactions. Why does it not get used more often? A major reason is that it is used by the innovators – a very small percentage of the population that adopts technology well ahead of everyone, including what we call “early adopters”. There is no coincidence that the percentage of Apple Pay transactions (< 3%) is very close to the percentage of innovators in general society (~2.5%).

​Where Is It Really Hard?

This report opened with statements that predict that Digital Wallets will shake the foundations of many industries.

We can’t expect that this will be easy. There are fundamental areas where the Digital Wallet space is either facing or will face difficulties. As a starting point consider the following:

  • The User Experience for Digital Wallets is incredibly difficult. The long list of capabilities required, user interaction, user journeys, security and more impose extreme difficulty. The initial success for Digital Wallets will be laser-focused on very specific use cases and people may have no idea that they are using a Digital Wallet.
  • Keeping It Safe (Loss and Theft Protection). Digital Wallet capabilities are increasing and the amount of Stuff we keep in them is growing. The pain of losing the contents of our Digital Wallet is increasing. Though people outside of the cryptocurrency Wallet space may understand, the general market does not “get” that their Digital Wallets need to be kept safe – and that means we need to lean on processes, organizations as well as tools that can help us protect our Digital Wallet.

Driving Adoption of Digital Wallets is difficult. A Digital Wallet is not a “first order” problem that people need to solve. Nobody wakes up and says, “Gee – I need a really good Digital Wallet”. What they do need is easier, safer, and even delightful ways to get things done in their lives.


This post is part of a 16-part series. This is the ninth post. For the first post click here, for the previous post click here, and for the next post click here.