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Bright Ideas · Advice · The Pros and Cons of Using Your Smartphone As Your Wallet

The Pros and Cons of Using Your Smartphone As Your Wallet

The day when we no longer have to carry around a wallet with cards and cash is fast approaching. Several services like Apple Pay, Google Wallet, and PayPal have emerged over the past few years that let you check out by using only your phone. You maybe be thinking (like I was!) “Is it really that much easier/better than just swiping your credit card?” Well, there are actually quite a few advantages to a mobile wallet (and a few drawbacks) and today I thought I would attempt to answer a few questions about this new way to pay.

More than half of Americans now own smartphones, and that number will only continue to rise. More and more of those phones are equipped with an NFC (near-field communication) chip, which basically means you can pay for everything from bagels to parking meters simply by tapping your phone to a compatible terminal and then entering your secret PIN or scanning your fingerprint.

How mobile wallets work:

  • It’s as simple as downloading a mobile wallet app to your phone (or it may be already built into your mobile device) and then linking your credit card to one of these services.
  • When you checkout at participating merchants, access the mobile wallet and choose your card. If you’re making an in-store purchase, just hold your mobile device at the terminal.


It’s convenient

  • By storing all of a consumer’s payment information securely and compactly, mobile wallets largely eliminate the need to carry a physical wallet.
  • Many popular stores have begun utilizing mobile wallet services and huge growth is expected this year. Even the U.S. Government has hopped on board. It was recently announced that Apple Pay will be available for many transactions with the Federal Government, for example when you pay for admission to your favorite national park.
  • You can pay your babysitter, pay back a friend for dinner, get a loan in a pinch, or bail out someone short on cash at a store.
  • Depending on the system you may be able to upload gift cards or loyalty cards.
  • It allows you to keep track of all of your credit cards and bank accounts in one place, instead of having to carry a wallet full of cards and keep track of each one individually.

It’s safe (for the most part)

  • It’s actually safer than using your credit card because each service requires an extra layer of protection. Google Wallet requires a four-digit code; PayPal asks for username and password; and Apple Pay relies on a passcode or fingerprint.
  • Lost a wad of cash? You’re not getting it back. Stolen credit card? The thief can run up your tab at stores all over the place before you even realize it’s missing. With a mobile wallet your credit card numbers are encrypted in the cloud (not sure about his “cloud” thing either? Read: How To Use “The Cloud” To Organize Your Life in 2015!) You can lock down everything remotely and won’t have to request new cards with new numbers if you lose your phone.
  • While your data is still somewhat vulnerable to breaches, the fact that you won’t need to carry a physical credit card leaves it less exposed to physical card theft and information-stealing devices like card skimmers.
  • Your shopping habits are not shared with any third parties.


It’s not widely available…….yet.

  • To use your mobile device’s near-field communication (NFC), you need to make purchases from a retailer with a POS terminal. Since these aren’t widely used yet, you will have to carry around your traditional wallet for a few years before you can completely toss it out. In addition, not all smartphones have NFC capabilities yet.

Lose your phone, lose your wallet

  • Americans lose their phones once every 3.5 seconds, according to a report by mobile security firm Lookout Labs. Mobile wallets raise the stakes of such a loss.

Battery dies, lose your wallet

  • Cell phone batteries are improving, but we all still inevitably find ourselves low on juice when we’re out and about. If you’re relying on your smartphone for both calling and paying for your purchases, your ability to pay is only as good as your last charge.


  • People tend to spend more when using a credit card because the money involved seems “less real.” This phenomenon could be exaggerated with a mobile wallet. You don’t even have to open your wallet.

There are still some safety concerns

  • There are concerns about how hackers might get a hold of your information with NFC since you’re transmitting your data wirelessly. However, these concerns are no different from those surrounding the use of credit and debit cards that store your information online.

Still think mobile wallets are futuristic nonsense? Think about this….not all that long ago cars used to wait in line to pay at a booth on toll roads, but now they just zip through lanes without any cash exchanged. In the same way, shoppers will someday speed through checkout lanes with a wave of their virtual wallet. I personally look forward to that day!

What’s in YOUR mobile wallet?? 🙂

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    Hi, I’m Jillee!

    I believe we should all love the place we call home and the life we live there. Since 2011, I’ve been dedicated to making One Good Thing by Jillee a reliable and trustworthy resource for modern homemakers navigating the everyday challenges of running a household. Join me as I share homemaking and lifestyle solutions that make life easier so you can enjoy it more!

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