E-wallets vs virtual cards: definitions and differences

E-wallets and virtual cards are digital payment mediums. Their functions are quite similar, which can lead to confusion.

As we’ve already described on our blog dedicated to e-wallets, virtual wallets, also known as digital wallets, are virtual accounts for storing money online and transferring it easily.

So what’s the difference between a neo-bank and online bank accounts?

That’s where the difference lies. This is not a traditional bank account. For example, an e-wallet cannot be overdrafted. What’s more, it makes it easy to load additional payment mediums in real time (such as prepaid cards, as we’ll see shortly). With no limits on money or time, they are appreciated for their flexibility and speed of execution (transfers within a second). What’s more, thanks to the introduction of automated settings, it is now possible to create e-wallets in a tree structure, with automatic transfer rules (e.g. end-of-month transfer, etc.).

Linking an e-wallet to a prepaid card :

The great advantage of an e-wallet is that it can be linked to any prepaid payment medium. The most common medium are prepaid payment cards. A prepaid card is a payment card like any other bank card, except that it cannot be overdrawn. It must therefore always have a positive balance. Hence the importance of having a full e-wallet! The e-wallet is the virtual wallet or account, while the prepaid card is the means of payment.

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The virtual payment card is, as its name suggests, a payment card. It is linked to a payment network such as VISA, Mastercard, UnionPay, etc. As it is virtual, it has no physical materialisation (in other words: no plastic). It is displayed on a screen with all the information of a real payment card: 16-digit PAN code, expiry date, cardholder’s first and last name, 3-digit CVV code. In particular, it allows you to make purchases over the Internet or by telephone. An e-wallet doesn’t actually allow you to make purchases. It is used to store money. When a virtual card is linked to an e-wallet, the e-wallet will load the card with the desired amount in real time, and the card will be used to pay.

The uses of e-wallets with virtual cards are quite broad:

– Large funds can be pooled and automatically transferred to membership cards (e.g. investor clubs, VIP customers).
– Wallet-to-wallet money transfers and loading money onto cards (e.g. money transfers within a family)
– Provision of virtual accounts to build customer loyalty with loyalty cards (e.g. chain stores)
– Payments in closed-loop environments (e.g. stadiums, festivals, stores)
– E-Shops with virtual cards
– Online kitty with amount paid on a virtual gift card

The prospects offered by e-wallets and virtual cards are enormous for companies wishing to innovate by offering real-time payment services to their customers. Setting up this type of project is quick and relatively simple. All you have to do is contact a Programme Manager and that’s it!