What Is a Digital Wallet?

How to Use a Digital or Mobile Wallet

To get set up with a digital wallet or mobile wallet, you'll first need to select and download an app, such as Apple Pay, Google Pay™ or Zelle, for example. The app will assign special digital card numbers for each of the debit and credit cards you link up, which are specific to your app and device only.

You'll also need to set up a single password for your digital wallet that grants you access to all your payment options. There's no need to memorize any information other than this password — if you're worried about forgetting it, write it down and keep it somewhere secure such as a home safe or password manager — never in your wallet or on your phone.

To make a purchase or use a coupon with your digital wallet, look for merchants that feature a contactless payment symbol or that accept payments via your particular app.

Keeping Your Digital Wallet Safe

In many cases, using a digital wallet can be safer than carrying a physical one — but only if you follow certain precautions. Here are a few simple things you can do to keep your digital wallet safe.

• Secure your phone. It's always a good idea to secure your phone to in case it's ever lost or stolen, especially if you're using a digital wallet. Enable fingerprint authentication or a password to unlock your phone — or both. You can set your phone to ask for a password (or fingerprint) after a certain amount of inactivity. For the highest security, set that time to be short, maybe just a minute or two.
• Use two-factor authentication. For every financial app you set up, be sure to enable two-factor authentication. It takes time to set up, and it's a bit of extra effort to log into your accounts, but the time and effort is worth it for the security and protection it offers. Learn more on how to set up two-factor authentication and why it matters.4
• Never use public Wi-Fi. Even if your phone security is tighter than Fort Knox, your sensitive financial information is still vulnerable to hackers if you use open or unsecured public Wi-Fi networks.
• Set up account alerts. To be on the safe side, it's a good idea to monitor your account activity and keep an eye out for any suspicious transactions. An easy way to stay ahead of potential fraud is setting up text alerts from your bank. For instance, you can receive a text any time a purchase for more than $50 is made.
• Keep your devices and software up to date. According to digipay.guru, this is one of the best ways to protect your digital wallet.5 So, how do you do this? First, you need to regularly update your operating system, phone firmware, wallet software, and internet browsers. Doing so ensures you fix known vulnerabilities soon after they're found. Next, you should also run regular antivirus scans to look for potential malware or viruses that log your keystrokes.

Learn more about managing your finances