Should you put all your credit cards in your mobile wallet?

Sometimes the price of convenience is free, and mobile wallets are a great example of this. These applications live on mobile devices such as your phone, watch, or tablet, and can take the place of cards and cash you put in a physical wallet. The number of cards and accounts you can add to a mobile wallet depends on the company you use. As a consumer, you will want to consider which you want to have immediate access to from your device and understand the security risks of having them there.

Here’s what you need to know about mobile wallets – from what they are to their security features and how to manage the accounts you have stored on your devices.  

What is a mobile wallet? 

There are several names for mobile wallets, including digital wallets and e-wallet, but all are apps that you can download to your mobile device. 

Some are already on your device, such as Apple Pay, Samsung Pay, and Google Pay. Other apps you may choose to download, such as PayPal and Venmo, both of which have mobile wallet features as well as the ability to send and accept money to and from other people. 

Whichever mobile wallet you use, though, you can add a variety of credit and charge cards, reloadable prepaid cards, debit cards connected to your checking account, gift cards and vouchers to the app. When you do, they will be safely stored on your device and ready to use at your convenience.

So, how to use a mobile wallet? Easy. Simply open the app, choose the stored card you want to use, and make a payment at the register by holding your device close to the contactless symbol on the payment terminal. You may also have to type in a code associated with the account or authenticate the transaction with your phone’s fingerprint or face sensor. 

You can use a mobile wallet for online shopping when you use your device, too. Look for the app’s logo, such as PayPal or Apple Pay on the site, and use it to complete your purchase at checkout. 

What are the advantages of using a digital wallet over a physical credit card?

Although there is nothing wrong with using physical credit cards, when you have them uploaded to a mobile device you can pare down what you carry. If you’re like most people, you usually bring your phone with you everywhere you go, making a physical wallet redundant. You’ll have everything you need to make transactions straight from your device. 

Keeping track of your spending can be easier, too. You can monitor your activity at the time of checkout or at any point without having to go to the bank’s website. When the mobile wallet is in your hand or on your wrist, you can always be aware of your balance, which can help with money management. 

So, then what is the primary advantage of using a physical card instead of a digital wallet? With physical cards, you never have to worry about whether or not your device is charged up. If you run out of battery, you won’t be able to purchase an item with a mobile wallet, but you can always use the credit card you have in your hand. You also don’t have to worry about whether or not a merchant accepts digital payments. While many these days do, that’s not the case 100% of the time.

Is it safe to put your credit card on your phone?

In general, storing your credit cards and other accounts in a mobile wallet is very safe. In fact, its security is a major factor in its favor. 

If your physical card is lost or stolen, somebody else can use it to make unauthorized transactions. However, if a person has access to your device, they will have to unlock it first, which requires a personal password. As long as it’s unguessable, they’ll be locked out. 

Additionally, mobile wallets use encryption which transforms data into a scrambled code that can only be deciphered with a specific key, and tokenization that changes after every transaction – both of which impede hacking. They may also use biometric authentication (such as face and eye scans) to vastly decrease the possibility of identity theft and fraud. 

In the event that someone has unauthorized access to your mobile device, technology can also come to your rescue. All of the major mobile wallets allow you to erase data remotely, which will block access to your accounts, even if the person has your passwords.

Security comparison: mobile wallets vs. physical cards

If you are nervous about uploading your account information to a mobile wallet, you may be put at ease by seeing how its security compares to physical cards. In many cases, your accounts are safer on a mobile wallet than they are when you carry your cards with you.  

A compelling benefit of a mobile wallet is that you can bring many accounts with you without loading up a physical wallet with a stack of plastic:

• Apple Pay – up to eight cards
• Samsung Pay – up to ten cards
• Google Pay – no limit 
• PayPal – up to 24 cards
• Venmo – up to four cards over a six-month rolling period

With choice comes opportunity. If you have multiple credit cards in your wallet, you have options at your fingertips.

Choose the right credit card for the most rewards. For example, when you’re grocery shopping, bring up the card that gives you the highest number of points for supermarkets. Know that you’ll earn 3% cash back on a certain category that quarter? Defer to that card. 

 ➤  SEE MORE:Best credit cards for groceries

If you want to avoid a bill or adding to existing debt, select the debit card that is connected to your checking account. Or If you have a prepaid card use it for payments, and refill it as necessary straight from the app. 

Having gift cards uploaded to your mobile wallet is great because you won’t risk losing them or only using some of their value. You will see how much cash is left after each transaction, and when the balance is depleted, you can purge the card from the wallet. 

Before and after making transactions, take a moment to see where you are financially. A downside to mobile wallets is that immediate access to funds and borrowing can be too tempting. Mobile wallets can also enable you to see your credit limit, the remaining credit line, and your current balance, though. When you use this technology properly, it’s an excellent tool to stay close to your money and avoid unnecessary debt. 

When you upload cards that you regularly and rarely use to your mobile wallet, you give yourself plenty of payment options. Everything you need will be available on a device that you carry with you on a regular basis – safely and securely.