Digital wallet loyalty: why consumers keep using the same tools across platforms

In 2024, more than 42% of UK adults had set up digital wallets, marking a 12% increase from 2022. People are increasingly seeing the benefits of these mobile payment options and are integrating them into their regular spending - and it’s not hard to see why.

Digital wallets offer enhanced security and increased convenience through one-click payments and seamless use across devices. Adding to the appeal of this payment option is the phenomenon of cross-platform loyalty that offers unique, personalised rewards to users.

These features and impacts don’t just benefit consumers; businesses benefit from them, too. By implementing loyalty programmes through digital wallet platforms, businesses enjoy faster transactions and higher customer retention rates.

These six major sectors benefit from digital wallets and cross-platform loyalty programmes supported by trusted wallets like PayPal, Apple Pay, and Google Pay.

Retail - One-Click Confidence

In retail environments, both in person and online, digital wallets like PayPal and Apple Pay are widely accepted, allowing shoppers to easily complete transactions without having to follow multiple steps. In-person near-field communication allows for contactless payments using smartphones and watches.

Online, digital wallet integration simplifies checkout into a one-click process, reducing friction points where shoppers might abandon their carts. The one-click process also reduces hesitation about placing the order by removing the number of opportunities to stop the process. The benefits and convenience of digital wallet payments are driving widespread adoption among both large retailers and small businesses.

Beyond streamlining checkout, some brands take digital payments further by integrating them into a more comprehensive digital and in-person experience. These omnichannel brands, which include Sephora, Ikea, Nike, and Apple, have shaped consistent, seamless, and highly engaging experiences from websites to mobile apps to physical stores.

Subscription Services - Frictionless Renewals

The subscription market is highly valued and is expected to reach $1.5 trillion in 2025. Yet even with this impressive industry worth, subscription services experience high churn and non-renewal rates. As a result, businesses struggle to predict annual revenue and growth while experiencing lower lifetime value (LTV) per customer and higher customer acquisition costs (CAC). Reducing churn and non-renewal rates requires multiple strategies, many of which digital wallets support.

A key factor in reducing customer churn is improving the customer experience, which, as noted, digital wallets help address. Digital wallets make onboarding payment processes more streamlined, often reducing them to a single click. By storing preferred payment methods, digital wallets ensure a seamless experience for future purchases and subscription renewals, reducing churn and non-renewal rates.

Amazon exemplifies this with its Prime membership. It holds on to payment methods, including preferred ones, for the customer so that they don’t have to look for their payment information when they use the service to order a product or pay for an upgraded streaming service. Their account securely stores their payment details, which fosters an enjoyable, minimally disrupted user experience that keeps Prime Members returning to use the platform and continuing to renew their subscription.

Often, churn and non-renewals are caused because a subscriber forgets to update their payment information, a card expires, or other unintentional activities. Digital wallets help power recurring payments by automating payment for subscriptions; this reduces non-renewal rates for businesses and prevents service disruptions for subscribers.

Travel - Seamless Global Transactions

Digital wallets offer travellers several perks that make them useful throughout a travel experience, from booking to boarding. PayPal, Google Pay, and other major digital wallets allow for painless flight and hotel bookings across platforms like Google Flights and Expedia, minimising how often personal information needs to be filled out.

They also hold onto boarding passes, tickets, transit cards, and other pertinent travel items. There’s also security in knowing that digital wallets provide buyer protection through enhanced security of payment information and the ability to dispute charges.

By accepting these wallets, businesses in the travel industry are shaping a more enjoyable customer experience that leads to the continued use of the platform. They’re building convenience into the booking process, particularly if travellers are spreading a trip out over multiple cities and require several flights and accommodations.

Digital wallet payments transform this tedious process into a seamless, one-click experience. When customers enjoy the experience, they’re more likely to return to the platform that simplified the process for them and recommend it to others.

Beyond booking conveniences, digital wallets also enhance international transactions by enabling travellers to handle currency conversions and send payments internationally. The ability to do this delivers flexibility in making purchases abroad, allowing travellers to make conversions as needed, all without spending time tracking down currency exchanges.

If travellers have their phones, they’ll have everything they need for making payments and bookings, navigating new places, and even finding entertainment in one convenient location - a convenience they can attribute to the use of digital wallets, further reinforcing their value and positive associations.

Online Gambling - Trust and Speed in Real-Money Transactions

The online gambling industry has undergone rapid growth in the last decade, leading to a saturated and competitive landscape filled with online sportsbooks, casinos, poker rooms, and more.

For gambling platforms to stand out, they need to prioritise security and speed in their gaming experiences. They also need to instil trust and confidence in new players who may have reservations regarding the security of sharing personal information. Digital wallets can fulfil both of these needs.

To facilitate gameplay, these platforms rely on fast and frictionless deposits and withdrawals that allow for uninterrupted gameplay and give players easy access to their winnings. An effective way to do this is through integrating digital wallets to carry out secure gambling transactions. This allows for a casual, engaging gaming experience where managing deposits and withdrawals won’t take away from the gaming entertainment.

Trusted online payments help establish brand credibility and trust in the gambling industry’s competitive landscape. They provide trust signals to prospective players, indicating that the platform is legitimate and secure for facilitating real-money gaming.

For instance, digital wallet-based betting platforms, like PayPal casinos, leverage the reputation, familiarity, and wide use of the PayPal brand to foster trust in prospective players. PayPal’s reputation and wide use immediately establish familiarity, instilling confidence in players to deposit funds and start placing wagers.

With the PayPal name attached, players will feel reasonably confident that they’ll have an engaging casino user experience that’s secure, easy to use, and offers frictionless withdrawals.

Food Delivery - Speed and Familiarity in Micro-Transactions

Food delivery offers convenience to customers in a speedy and tangible way. With food arriving within an hour - ready to eat immediately - it’s one of the most instantly gratifying online purchases. Through apps and delivery platforms like Zomato, Swiggy, and Uber Eats, it only takes a few steps to complete an order with as many customisations as needed. Each order often comes with rewards, like points or discounts, which can be applied to future purchases.

Digital wallets enhance food delivery by streamlining payments in ordering apps. They speed up transactions, enhance the ordering experience, and integrate loyalty programs, enticing customers to order again in the future. Digital wallets enable one-click payments, including tips, creating a seamless, fast checkout process for orders both big and small. It also simplifies and speeds up refunds when needed.

The Gig Economy - Instant Payouts and Digital Trust

The UK has a thriving gig economy, with an estimated 1.7 million freelancers and gig workers. For both workers and those seeking their services, digital wallets help facilitate payments in a reliable and trustworthy way. As a result, freelance platforms like Fiverr, Upwork, and Behance accept payment methods like PayPal to deliver convenience to workers and their clients.

For freelancers and gig workers, digital wallets provide quick processing times, immediate access to earnings, and seamless connectivity to other financial accounts. For clients, it simplifies the payment process by making it a one-click process while also keeping their financial details private. While it feels like an informal payment option, it offers reliability in complex payment ecosystems, where trust and security are top concerns.

Conclusion

Digital wallets prioritise convenience and seamless experiences, resulting in increased trust, loyalty, and revenue for businesses.

Across sectors, platforms are integrating familiar digital wallet payments, reducing friction during checkout and streamlining onboarding while increasing trust. From digital wallet casino payments to shopping online, savvy businesses are ensuring customers can use their preferred payment methods. Those that don’t risk falling behind.