Towards understanding the adoption and social experience of digital wallet systems

Abstract

For millions around the globe, digital wallets are replacing cash and credit cards. These services support user-to-user payments, and add a social component to transactions. However, there is little understanding of the key factors behind digital wallets' rapid growth in US (Venmo) and China (WeChat Pay). What are the factors that led to their success? How social relationships play a role in their adoption? We conduct a mixed methods study, using a comprehensive survey (N=879) and semi-structured interviews (N=41) to explore the interplay of the two roles of these digital wallets, i.e., a payment system and a social platform. Our analysis suggests that the network effect does benefit their adoption and retention, but through different mechanisms. In return, transaction activities performed in digital wallets help strengthen existing social ties. We also present design implications for future social payment services.