The Importance of Digital Money in Digital World

As time travels, from era to era, we all know that in this society that has been enveloped by technologies and computerized equipment, and by how fast and efficient everything has become, as one of the societies, we ought to be a part of the evolution, of the development and create an improvement as how we could. Days fly fast and we are not created to be left in the cold by technology, but to adapt to every newest gadget even if it doesn’t relate to our lifestyle. An important service that we have applied to our life since we were little is no other than transaction. We all have our own necessity or essential, we all live up to that by buying all of the requirements of our own, or even to our loved ones. But things had significantly changed, from the time where we used to pay with cash and pennies, but now as the technology fosters, and for other external causes, we all now have the term “Cashless Payment”. The evolution of payments has now reached the certain stage where we can now pay without using cash or having another separate wallet for ourselves to keep pennies even if it kept falling to the ground and making a fuss as we tried to keep our changes.  

The importance of knowing about digital money is now more than just a necessity, it is now considered as a basic knowledge to know about it since we are all enveloped in a digital world such as online shopping, contactless payment and top-up services. Now, we may all question the existence of cashless payment or digital money, and that is why we will have to rewind back to the late 1900s.

The first digital payment service of E-cash was introduced in 1997 by David Chaum. This digital payment supports the users to generate an anonymous online transaction. Still, due to many technical difficulties and managerial complications, the system failed.

One year later, Paypal was developed as an alternative way to traditional payment procedures such as cheque and money orders. Thus allows the users to transfer and to receive money using an email address and a linked bank account or credit card, with these simple transaction procedures enabled the Paypal to become the go-to payment platform for online auctions and e-commerce sites. 

In the early 2000s, the popularity of online shopping has grown significantly while more of the online merchants desired a way to make digital payments even more convenient for their customers and that is where Amazon and Google and other companies began to introduce their own payment systems like “Amazon Payments” and “Google Checkout”. 

In 2011, another big leap of milestones for digital payments came with the start of Square, a payment service that allows small businesses to accept credit card payments using just a mobile device and a card reader. The reformed payment procedure for any independent vendors and small merchants.

And in current days, in the consideration of smartphones’ popularity throughout nowadays, another payment procedure rises to adapt with the newest situation which people call Mobile wallets or E-Wallets. This system allows the users to deposit and to accumulate their debit and credit card information guardedly and use it for a variety of transactions.

And for those of you who want to convert your money digitally, there are various ways to convert that you can use. Topping up is a commonly used term to define converting physical money to digital money, and to do it, you will have to download an E-Wallet app on your mobile and transfer your money into your personal account like a bank transfer or even through outlets that collaborate with E-Wallet services. Once you have transferred your balance to your account, you can now use the money to proceed any transactions. To pay with your E-Wallet, you can open the app and select your payment option. Some options may be to scan the QR code that is preserved on the cashier, or the cashier themselves will ask for your account’s QR code for them to scan. Some merchants also have the appropriate machine on the counter for you to tap with your mobile and it can scan by its own. 

For those who are still confused of what app should you use, you can choose from one of these recommended services in Indonesia: 

• Gopay, a Gojek service transaction that provides a withdrawal feature so you can withdraw money in cash through a convenience store or transfer it to your bank account; 

• then we have OVO that are probably the most well-known platform with over 60,000 outlets partners throughout Indonesia and OVO is also affiliated with Grab so you can have an easier and faster payments; 

• Dana E-Wallet that provides a world-class security features, using the two-steps authentication for each transaction with PIN code and OTP; 

• And for the last, we have ShopeePay, last but not least, Shopeepay is useful for transaction at its own merchant, Shopee. Shopee who claim to have free shipping, using promotions like discounts, vouchers and cashback. And when there is a refund from the transaction, the balance will automatically be saved into your account and can be used for the next transaction.

And all of the apps above have been approved by millions of users in Indonesia in terms of efficiency, convenience, and security.

However, E-Wallet services can also have their own pros and cons which was mostly subjective depends on the user, but mostly of the pros and cons can be seen by: 

• The pros of E-Wallet services is to make every transaction quick and efficient without having some bumpy wallet in your pocket filled with money or even as mere as keeping changes every time you bought something. E-wallet can also minimize the chances of getting our money stolen since most of the platforms are using two-steps authentication and many other security features to keep transactions safe and recorded. Moreover, E-Wallet services can give you more discount and cashback in some platforms

• The cons of E-Wallet services are the limited merchant and stores since in Indonesia, a lot of small merchants still use cash for payment and if we didn’t have any cash on our hand that time, it could be some disadvantages for the user. Some of the platforms also require admin fees, so the user will have to pay more from the original prices. And by how easy and fast these E-Wallet services are, some users could be overconsumption, but that is the challenge for the users to hold themselves back from making unnecessary transactions including food, beverages or even accessories.

Hence, we all know what we have to know about Digital money, and for the convenience and security. But what’s so important about it? Generally, to know anything happening in our surroundings is important, but as we predicted, technologies will keep advancing and advancing right before our eyes. In the future, there might be the things that we now have never thought to be as real as how the people in the past won’t expect that now we can pay without handing physical money. 

And as we know, more and more of the merchants and stores did not accept cash anymore due to the COVID-19 pandemic quite years ago but even till now they consider digital payment as an easier, quicker and efficient method to apply. Or for the people around us have directed towards a digital world, and when we were left behind, it would be a hard time to keep up with it once it has accelerated at an unbelievably quick pace. It is important to us to be a part of the digital world and adapt to the newest environment.

Source

Hesanty. A. N. “What is an E-Wallet? How It Works, Examples, and Benefits!” 2023. NIAGAHOSTER. Article. niagahoster.id What is an e-wallet? How It Works, Examples, and Benefits! (niagahoster.co.id) 

Isnanto. B. A. “Definition of e-Money: Benefits, Risks, and Differences with e-Wallets” 2023. detikfinance. Article. finance.detik.com Definition of e-Money: Benefits, Risks, and Differences with e-Wallets (detik.com)

Kisters. S. “Evolution of Digital Payments: A Timeline” 2023. originstamp. Article. originstamp.com The Evolution of Digital Payments: A Timeline | OriginStamp