Digital wallet: A guide for Canadian

We live in a digital world—so why are you still using an analog wallet?

A digital wallet offers a quick and convenient way to pay for purchases just by tapping your smartphone. This means you no longer have to lug around a physical wallet full of debit cards, credit cards and cash everywhere you go.

But how do digital wallets work, are they safe, and how do you find the best digital wallet for your needs? Keep reading to find out.

What is a digital wallet?

A digital wallet works like an electronic version of your physical wallet. Also known as a mobile wallet, a digital wallet is an app that securely stores all your credit card and debit card details — allowing you to safely tap your phone to pay for purchases.

Digital wallets are becoming more widely used because they essentially eliminate the need to carry around plastic payment cards. However, you can also use digital wallets to store loyalty card details, gift cards, plane tickets and more.

How do digital wallet apps work?

Digital wallets in Canada work through apps on your phone and use NFC (near field communication). NFC is a technology that allows devices to communicate when they get within a few inches of each other — like when you hold your phone near a contactless payment terminal. The app authenticates your purchases through encryption, tokenization and two-factor authentication.

But some apps also use other technologies to process payments. For example, older Samsung devices support magnetic secure transmission (MST) as well as NFC, so you can use your Samsung Pay mobile wallet at card readers that aren’t equipped for contactless payments. However, MST is being phased out on newer devices. Other apps, such as PayPal, allow you to scan a QR code to make a payment.

What digital wallets are available in Canada?

The four most popular digital wallets available in Canada are Apple Wallet, Google Wallet, Samsung Wallet and PayPal. Let’s take a closer look at what each of these digital wallet apps offers to users

Apple Wallet (Apple Pay)

Apple Wallet is the iOS digital wallet for Apple devices like iPhones. It typically comes pre-installed on iPhones and Apple Watches, providing a convenient way to store your credit and debit cards, loyalty cards and more.

The cards you store are linked to your Apple Account, while iCloud encrypts your Wallet data for storage and whenever it’s sent over the internet.

The debit and credit cards you store in Apple Wallet can be used to make purchases in-store, in-app and online with Apple Pay. You then have the option to pay with Face ID or Touch ID to confirm payment.

Supported cards and items:

Google Wallet (Google Pay)

Google Wallet is a secure digital wallet for Android phones, Fitbit watches and smartwatches that run Wear OS. You can use the cards you store in Google Wallet to tap to pay anywhere Google Pay is accepted.

To ensure that your payment details stay secure when you make a payment, Google Pay sends a virtual card number to the merchant rather than your actual card number. Online payment data is encrypted, and the payment details you save are stored on Google’s private servers.

To make a payment, hold your Android smartphone near the payment terminal and wait for the blue tick to appear.

Supported cards and items:

PayPal

PayPal is best known as an online payment method, but its app features a digital wallet that you can use for in-store purchases. Once you link your bank account and credit and debit cards to your PayPal account, you can pay for purchases in-store by scanning a QR code at checkout.

Encryption and fraud monitoring are used to protect your payment details, while PayPal Buyer Protection provides cover if you purchase an item that either doesn’t arrive or is significantly different to how it was described.

The PayPal app can also be used to send and receive payments, send international money transfers and check out securely online.

Supported cards and items:

• Debit cards
• Credit cards
• Bank accounts

Samsung Wallet (Samsung Pay)

Samsung Wallet combines features from the Samsung Pay and Samsung Pass apps into a single digital wallet app. Available on devices running Android 9 (Pie) or above, Samsung Wallet supports Visa, Mastercard, Interac or American Express credit and debit cards.

Card information is encrypted when you add it to your wallet, and you get the peace of mind of Samsung’s security platform, Samsung Knox. Samsung Wallet uses tokenization, replacing your private payment card information with a device-specific token to keep your details secure. You’ll also need to use your fingerprint or Samsung Wallet PIN to verify your identity when making a payment.

Supported cards and items:

Other wallets

There are also a few other digital wallets available in Canada.

Chinese digital wallet Alipay is reportedly accepted by some Canadian merchants, while Chinese tourists and newcomers to Canada may also be able to pay with WeChat Pay.

Garmin Pay also offers a contactless payment method in Canada using Garmin watches. However, it’s only supported by a limited range of Canadian financial institutions, including ATB Financial, Canadian Western Bank and Manulife Bank of Canada.

Which digital wallet apps are not available in Canada?

There are several popular digital wallets that are popular in other countries, particularly the US, but that are not available in Canada. These include:

• Amazon Pay
• Cash App
• Dwolla
• Venmo
• Walmart Pay
• Zelle

What is the best digital wallet?

The best digital wallet for you depends on your device’s operating system.

If you’re on an iPhone, Apple Wallet is the best choice for iOS devices. Apple Wallet is easy to use, provides a secure way to pay, and comes pre-installed on your iPhone.

If you’re on an Android device, Google Wallet is the best choice — unless you use a Samsung phone, in which case you’ll want to compare Google Wallet and Samsung Wallet head to head. Both offer impressive security and are easy to use, so it may just come down to personal preference.

Alternatively, you might just decide to use whatever digital wallet app comes pre-installed on your phone. And if you get a new Galaxy, you can expect it to come with Samsung Wallet ready to go.

What digital wallets do banks in Canada support?

Bank	Apple Pay	Samsung Pay	Google Pay	PayPal	Get started
BMO					BMO Performance Chequing Account: Go to site
Tangerine					Tangerine No-Fee Daily Chequing Account: Go to site
EQ Bank					EQ Bank Personal Account: Go to site
Coast Capital					Coast Capital Free Chequing, Free Debit, and More Account: Go to site
KOHO					KOHO Everything Plan: Go to site
Scotiabank					Scotiabank Preferred Package: Go to site
Simplii Financial					Simplii No Fee Chequing Account: Read review
National Bank					National Bank Modest Chequing Account: Read review
CIBC					CIBC Smart Account: Read review
RBC					RBC Signature No Limit Banking Account: Read review
TD					TD Unlimited Chequing Account: Read review

How to set up digital wallets on your phone

In many cases, popular digital wallets like Apple Wallet, Google Wallet and Samsung Wallet come pre-installed on your device. If that’s not the case, or if you’re using a different wallet, you’ll need to download the app first.

Here’s what you need to do to set up a digital wallet:

1. If the wallet app you want isn’t pre-installed on your device, download the app you want from your operating system’s app store.
2. Open the app.
3. Tap the button to add a payment card to your wallet — this button could be a plus sign or might feature the words “Add to wallet”.
4. Select the type of card you’d like to add.
5. Use your phone’s camera to scan your card, or enter the card details manually.
6. Review and confirm the card details.
7. Save the card to your wallet.

Are there any limits or fees while using a digital wallet?

Typical debit limits for tap payments using digital wallets range from $100 to $250, while there may also be a cumulative limit to contactless payment amounts. Make sure you check with your financial institution for details.

Digital wallet transaction limits are not set by the digital wallet provider, but are instead set by your bank or card issuer.

There are typically no fees for using a digital wallet. But your bank or merchant might charge fees based on the types of transactions you perform. For example, you could be hit with fees if you exceed your account’s monthly transaction limit, or the merchant might add a surcharge if you pay by credit card.

Digital wallet example: How to use a digital wallet

Sean lives in Toronto and is ready to say goodbye to his old-school physical wallet. His Android smartphone already has Google Wallet pre-installed, so Sean decides to add his credit card and debit card to the app. With his wallet set up, he heads to his local Loblaws for his weekly grocery shop.

After filling his cart and scanning all his items through self checkout, Sean’s grocery bill comes to $127. To pay with his digital wallet he:

1. Selects card payment from the checkout screen.
2. Opens the Wallet app on his phone and selects his credit card.
3. Holds his phone near the contactless reader on the payment terminal.

Sean’s phone vibrates and shows a big tick on the screen to let him know payment has been successful.

Are digital wallets safe?

Yes, digital wallets are considered a safe and secure payment method. They use encryption and security features like tokenization to protect your sensitive payment details, and you can often set up two-factor authentication for an added layer of protection when confirming payments.

But you’ll also need to take sensible precautions to keep your funds and payment details secure:

• Protect your phone. Set up biometric identification on your smartphone or create a strong PIN/password. This provides protection if you lose your phone or it is stolen.
• Only use official apps. If you’re downloading a digital wallet app, make sure you only ever do so from Google Play or the App Store.
• Update software. Make sure to regularly update your smartphone to the latest software version to protect yourself against online threats.
• Monitor your accounts. Regularly review account statements for any cards linked to your digital wallet. If you notice anything suspicious, flag it with your bank.

Pros and cons of using a digital wallet

Samsung Pay vs Google Pay

If you’re a Samsung smartphone user choosing a digital wallet, you’ll need to decide between Samsung Wallet and Google Wallet. Both can be used on Android devices, so compare them head-to-head to decide which is right for you.

Both are easy to use, both allow you to add multiple cards and items, and both provide a high level of security. Google Pay is more widely accepted globally than Samsung Pay, but Samsung Pay is specifically designed for use on Samsung smartphones, and it comes pre-installed on new Galaxies.

Ultimately, whether you choose Samsung Wallet or Google Wallet may simply come down to ease of use. It’s worth trialling both apps before deciding which one to use as your main payment method.

Bottom line

Digital wallets are a simple and convenient way to pay for purchase and manage things like event tickets, boarding passes and loyalty cards. So if you’re ready to join the digital revolution, compare a range of apps to find the best digital wallet for you.

Frequently asked questions about digital wallets

• Is PayPal a digital wallet?

  Yes, PayPal is a digital wallet that allows you to send and receive payments worldwide, plus pay for purchases in-store and online. You can link debit cards, credit cards and bank accounts to your PayPal account to pay for transactions.

• Is a digital wallet the same as a bitcoin wallet?

  No, they're not the same. Cryptocurrency wallets are apps or software solutions that allow you to save and transfer your cryptocurrency. Digital wallets allow you to store your credit and debit card details in a mobile app so you can pay for purchases in-store and online. For a detailed explanation of what crypto wallets are and how they work, check out our guide to the best cryptocurrency wallets.

• Google Pay vs Samsung Pay — what's the difference?

  Google Pay and Samsung Pay are both secure contactless payment methods. However, Samsung Pay is only available on Samsung devices, while Google Pay can be used on Android devices.

• Is Google Pay the same as Google Wallet?

  No. Google Wallet is a digital wallet that can be used to store your credit and debit card payment details as well as loyalty cards, gift cards, event tickets and more. Google Pay is a payment service that lets you use the credit and debit card details saved in your wallet to make contactless payments in-store, as well as pay for in-app and online purchases.

• What's the difference between Apple Pay and Apple Wallet?

  Apple Pay is a payment system, while Apple Wallet is a digital wallet. Apple Pay can be used to make contactless payments in-store and to pay for purchases online and in apps. Apple Wallet is a digital wallet app where you store your debit and credit card details so you can pay with Apple Pay. Wallet can also be used to store loyalty cards, ID cards, transit cards and more.

Written by

Tim Falk

Writer

Tim Falk is a freelance writer for Finder. Over the course of his 15-year writing career, he has reported on a wide range of personal finance topics. Whether you're investing in stocks and ETFs, comparing savings accounts or choosing a credit card, Tim wants to make it easier for you to understand. When he’s not staring at his computer, you can usually find him exploring the great outdoors. See full bio

Tim's expertise

Tim has written 457 Finder guides across topics including:

• Banking
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• Stock Trading
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