What is an e-Wallet

The e-wallet or electronic wallet operates in much the same manner as a physical wallet. When the e-wallet was first conceived it was intended to serve as method whereby e-cash (electronic money) could be stored. Since then, due largely to the lack of enthusiasm for e-cash services, the digital wallet, as it is also known, has evolved into a convenient tool that online shoppers may make use of to perform payment transactions and store the related information.

Technically, the e-wallet consists of two components. A software element provides encryption facilities to keep transaction details and personal information both private and secure, while the information component provides a transaction record similar to a bank statement.

E-wallets are typically stored on a client PC which allows them to be easily managed by the account holder. They are compatible with most e-commerce sites including online gambling venues such as casinos and poker rooms. The newer server-side e-wallets, hosted by a financial intermediary, are now gaining favour with both online sellers and purchasers due to their greater security and additional functionality.

Setting up a client side e-wallet is simple and it is equally simple to use. After the software installation, the user then enters all relevant information to complete the digital wallet setup. When used in the check-out page of an e-commerce site, the stored user information is automatically entered into an online form. In order to conceal personal information from unauthorized users a password is required before the data can be transferred to the form.

To ensure that e-wallets are compatible with online e-commerce outlets both wallets and sites must now employ a protocol known as ECML (Electronic Commerce Modelling Language). The protocol defines the fields and layout required to ensure that an online order form is compatible with the personal data stored in the digital wallet.

In use, an e-wallet accesses a credit card or other funding option securely to provide the funds for an online purchase. It does so without the need to reveal any sensitive details of the funding account during the transaction.

Statistics suggest that more than a quarter of online shoppers fail to complete their orders because of the complexity of the online order forms. The e-wallet relieves the shopper's frustrations by performing much of the task automatically.

Among the popular e-Wallet brands accepted at most online casinos, poker rooms, bingo parlours and sports betting outlets are NETeller, Moneybookers, EziPay, Click2Pay and UseMyWallet.

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