State of Tech / Art of The Possible

 State of Digital Wallets – Part 9/16


This post, “State of Tech / Art of The Possible,” is an excerpt from a report entitled The Current and Future State of Digital Wallets, which is being shared here as a 16-part series. Download a copy of the report. Read a complete summary.


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 successfully created credential-based versions of their cards and accounts. Very few, if any, are based on standards beyond using QR codes for validation.
  • Payment Cards. Both the iOS and Android ecosystems have built-in payment approaches. The Android “Wallet” (e.g. Google Pay)

More generic Digital Wallets exist, 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. For example, travellers now see that their boarding passes are showing on the lock screen, and 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.

State of Tech

Where Are Things Working (and Failing) Now?

When examining the Digital Wallet space, it is crucial to consider the lack of solid success in this area. Organizations that intend to build a business based on a Digital Wallet should be aware of this challenge. There are some areas where Digital Wallets are currently working well. To illustrate, let’s look at these examples.

  • Payments are increasingly popular, though still a tiny market with less than 3% of eligible transactions. Apple has the financial capacity to play the long game here, and we 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 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 theatres, and other apps (e.g. Meetup). The effortless ability to find a ticket in your phone’s Digital Wallet benefits 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 and taught people that digital wallets can secure digital assets. The impressive number of failures also provides a warning that 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 technology’s immaturity but even more due to a misguided belief that technology alone is the solution. The list of areas of loss could take pages, so let’s 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 – A significant reason that only 3% of eligible transactions use Apple Pay is mainly innovators adopting the tech – a small percentage of the population who embrace new technology well ahead of the general population. It’s not a coincidence – the percentage of Apple Pay transactions is very close to that of innovators in general society.

​Art of The Possible

Where Is It 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 challenging. The long list of capabilities required, user interaction, user journeys, security and more impose extreme difficulty. The initial success of Digital Wallets will be laser-focused on particular use cases, and people may have no idea that they are using a Digital Wallet.
  • Keeping It Safe (Loss and Theft Protection). As digital wallets become more sophisticated and contain more sensitive information, losing them becomes more severe. Many still do not understand the importance of keeping their digital wallets safe and secure. We must rely on processes, organizations, and tools that can help us protect our digital wallets.

Driving the 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 perfect Digital Wallet.” They need more straightforward, safer, and delightful ways to get things done in their lives.


This post, “State of Tech / Art of The Possible,” is an excerpt from a report entitled The Current and Future State of Digital Wallets, which is being shared here as a 16-part series. Download a copy of the report. Read a complete summary.

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