when you use it to make a purchase or payment the payment app uses a technology called near field communication nfc which uses radio frequencies to communicate between devices nfc uses the personal identification format created for the user to communicate the payment information to the merchant s point of service pos terminal the information transfer is usually triggered when the user waves or holds an nfc enabled mobile device over the store s nfc reader 
let s say you add your debit card to apple pay and want to use it at mcdonald s you would hold your phone next to the card reader which uses nfc technology to communicate with your phone apple pay opens using a verification method such as face recognition or a passcode and asks you to click a button to confirm payment through the default payment method stored with the app you could also tap the app to use a different card you ve stored in the app 2 the payment information is sent through nfc technology 3the terms mobile wallet and mobile payments are often used interchangeably but there are slight differences between them special considerationssome of the most common concerns about mobile wallets include how card information is handled and whether they are secure your debit card information is never stored on the device instead when you sign up for the service the card information is encrypted and stored on a secure chip when you make a purchase apple uses a token a unique randomly generated number that can be mapped to your original data if a thief should get hold of the token it would be useless to them 3types of mobile wallet appsmost smartphones and mobile devices are equipped with nfc technology iphones have apple wallet and apple pay android phones are often equipped with google wallet and samsung galaxy phones are preloaded with their proprietary samsung wallet which includes samsung pay besides what comes preloaded on smartphones mobile wallets from other companies have also become very popular some apps developed by third parties include benefits of mobile walletsfraudulent activities such as identity theft are harder to initiate with mobile wallets though a user s credit card can easily be stolen or duplicated smartphones are not so easy to steal a smartphone that is stolen may be hard to access if there is an access password fingerprint check or facial recognition installed as discussed above mobile wallets don t store your card information on the phone and use encryption and tokenization for secure transactions 5using a mobile wallet can be faster than using a chip card for a payment and because mobile wallets are a digitized version of physical wallets almost every valuable card stored in a physical wallet can also be stored in a mobile wallet such as a driver s license social security card health insurance cards loyalty cards hotel key cards and bus or train tickets digital wallets vs mobile wallets and paymentsdigital wallet is another term used interchangeably with mobile wallet or mobile payments however they are implemented differently even though they both store payment information digital wallets are mostly used for online transactions and may not necessarily be used on mobile devices mobile wallets are used by people who would rather not carry a physical wallet when making in store purchases for this reason these wallets have to be used on mobile and easy to carry platforms apple pay samsung pay and google pay are examples of mobile payments that can be installed on a handheld or wearable device a regular paypal account is a form of a digital wallet but when used in conjunction with mobile payment services and mobile devices it functions as a mobile wallet 