By Alex Taylor, UK Managing Director, Mangopay
In an age of smarter spending, value matters more than ever. As UK consumers become increasingly intentional about how they manage their money, they’re also raising expectations around rewards and digital convenience. That’s why in-app wallets are quickly becoming the must-have tool for both consumers and digital platforms.
Unlike traditional digital wallets like Apple Pay or Google Pay, in-app wallets live inside a platform’s ecosystem. Once considered a niche payment option, they mean users can pay, receive money, store value, and get instant refunds, without ever leaving the app.
Our research indicates that in-app wallets are now the UK’s second most popular payment method, behind only debit and credit cards, with nearly one in three consumers choosing them when paying on platforms. As everyday transactions shift online, from booking travel to ordering groceries, wallets are evolving from a convenient add-on to a business-critical loyalty and growth tool.
Why consumers are switching
In-app wallets deliver something traditional payment methods can’t: built-in value. Our research also reveals a quarter (26%) of wallet users collect loyalty points or rewards, while 41% prefer refunds paid straight into their wallet instead of back to their bank account.
This trend is especially strong among younger users. Among 16–24-year-olds, 67% earn income through digital platforms. For these users, wallets are more than just a way to pay. They’re where they get paid, manage funds, and put earnings back to use instantly.
Globally, 43% of users are already using in-app wallets regularly to purchase flights, pay for services, and complete everyday transactions. The numbers are speaking for themselves – wallets are fast becoming the default way people interact with platforms, not just for payments, but for the full customer journey.
The challenge for platforms now is to plug the adoption gap. That means making wallets easy to find, simple to set up, and rewarding to use. With 59% of shoppers basing their purchasing decisions on reward schemes, wallet-driven loyalty programmes could mean the difference between a one-off customer and a lifelong user.
From loyalty feature to ecosystem lock-in
Loyalty is now one of the biggest differentiators for platforms. UK shoppers care about rewards, but traditional loyalty programmes are often fragmented or slow, relying on external systems or third-party integrations.
In-app wallets change that. Platforms can deliver perks instantly without relying on external infrastructure – whether it’s cashback, discounts, points or exclusive deals. Refunds processed straight into a wallet, loyalty points redeemed in seconds, and earnings accessed on-demand all create a seamless, rewarding experience, one that builds a stronger connection with the platform.
This structural shift of closed-loop wallet systems keeps value circulating inside the platform, driving repeat purchases and increasing lifetime value. Every transaction becomes an opportunity to engage users, helping platforms stand out in a crowded market.
This goes beyond saving money and into reshaping consumer behaviour. Consumers who feel rewarded and valued are less likely to switch providers, and more likely to increase their frequency of transactions. For platforms, that translates into greater resilience in a price-sensitive economy and a powerful way to drive long-term growth.
Unlocking growth with embedded finance
In-app wallets are also the gateway to a new era of embedded finance. For users, this means richer features: instant earnings, savings pots, cashback boosts, budgeting tools, and more, all within a single, trusted ecosystem. For platforms, it means transforming one-off transactions into deeper, ongoing relationships that drive engagement and open up new revenue opportunities.
Adoption is already accelerating with one in four UK wallet users using them multiple times a week, while wallet adoption is highest among digital-native generations who will make up the majority of spenders soon.
The time to act is now
The next loyalty battle won’t be fought with points cards or one-off discounts. It will be won at the point of payment, where value is instant.. In-app wallets are integral to that next wave of customer loyalty and growth. For UK shoppers looking for smarter ways to spend and save, wallets deliver speed, convenience, and rewards in one seamless experience. For platforms, they represent an opportunity to differentiate, retain users, and unlock entirely new growth channels. The time is now to embrace in-app wallets, not just as a payment feature but as a strategic growth engine.
