CB Insights projects that digital wallets will follow the trajectory of ‘super apps’
A research report by CB Insights postulated that the development of “super apps” from single-function digital wallets is rapidly gaining momentum, with the trend set to continue, particularly in Asia, Europe and the United States. CB Insights industry analyst consensus predicts that this trend is expected to grow the digital wallet market from the current $1 trillion to $7 trillion by 2027.
According to the report titled “The Future of Wallet: How AI Advisors, Digital IDs and Wearables are Transforming Mobile Wallets into the Next Super Apps”, the development of super apps has become necessary given the growing adoption digital wallets for payments. following the coronavirus pandemic.
Not everyone thinks this is a wise development path.
The report indicates that Asia appears to be leading the way in this regard, as many digital wallets have moved from their original functions to other service areas such as food delivery, hotel and restaurant reservations and taking taxis, among others. He cites two well-known Chinese apps, AliPay and WeChat, which both started out as single-function apps for financial payments but later added other services.
In Europe and the United States, the report notes, some fintech companies are also developing super apps. The French start-up Lydia and PayPal in the United States are cited as examples in this case, and many other American financial technology companies are said to try the novelty.
“Smart” Financial Assistants
Along with projections on the growth and development of super apps, CB Insights also examines automated AI-powered financial assistants and the role they can play in managing personal finances.
Here, the report predicts that “assistants will take on the role of a smart advisor who constantly reviews customers’ subscriptions and bills, manages their budgets, suggests savings and investment strategies, and provides other relevant feedback.” on how to achieve financial goals”.
The report adds that some fintech companies such as robo-advisors are already working to create AI-powered automated money management solutions.
More Uses for Digital ID Wallets
In addition to serving as carriers of digital identity documents such as ID cards and driver’s licenses, digital wallets, whose adoption has been driven by the pandemic, can be used to carry a wider range of information such as medical records or office keys, the report points out. .
CB Insights believes that “standard digital ID wallets of the future will store payment information along with other essential documents including state IDs, SSNs, passports, citizenship information, medical records, house and office keys, and even biometric information such as fingerprints and face. scans. »
The booming wearables industry
According to the CB Insights report, wearable devices that were first introduced for health and fitness monitoring purposes, are now also expanding into other areas such as payments and other contactless transactions.
The global wearable payment device market was valued at $285 billion at the end of 2019 and is expected to reach $1.3 trillion by 2028, the report notes.
CB Insights believes that in the future, mobile wallets will be “safer and smarter”.
“Whether stored in a user’s smartphone or strapped to their wrist, the next generation of mobile wallets will go beyond facilitating transactions, offering a variety of financial products as well as identity management. digital and dedicated virtual assistants. Equipped with advanced AI-powered analytics and personalized user experiences, our wallets will play a bigger role in our financial decisions over time, becoming trusted advisors and trusted sources of information for all things financial. finance,” concludes the summary of the report.
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