It's easy enough to type in your credit card number when you're shopping online. So what's the point of having some company like PayPal handle transactions like a virtual wallet?
"One of the reason you see these virtual wallets really coming to the forefront, is because about 25% of all sales online are lost because of the fact that people get frustrated with the online buying experience," said Brian Smith a Management Information Systems Instructor at USC's Johnson College of Business and Economics.
He says it's all about feeling more secure when you click purchase. And that's not just for the buyer.
"I wanted to buy a set of golf clubs and the only thing they would accept is a PayPal account," said Nelson Dickson, an online buyer. He says he had to set up a virtual wallet to make a purchase on eBay.
"They use secure methods of transmission both between your client and their server, and between their server and the third party server that you're actually buying from, very very secure mechanisms," said Smith.
Still, Smith points out the information is stored on a remote server and companies have to constantly update security to ward off hackers.
But the business is so successful that Google is getting in on the action with Google checkout. It's like PayPal but only allows you to store debit or credit card information, not your bank account number.
And then there's bill me later, a good option if you need to borrow cash upfront. Just be prepared to pay up when the bill arrives or pay interest.
And pretty soon tech experts say the term virtual wallet will take on a whole new meaning when this is replaced with this. It's already happening in places like Japan, where the cell phone is used to complete sales transactions using radio waves.
Until then, experts say using virtual wallets is a better option than typing in your credit card number time and again.
Email
Facebook
Google
Twitter
Favorites
More
Advertisement