My physical wallet is useful - it helps me store a number of valuables and memories but it is dumb. It doesn't know anything about me. Ironically, we are creating the equivalent in digital or mobile wallets in spite of the fact that digital wallets have the potential to be more intelligent, understand our preferences, and provide contextual help and advice.

This could be related to the poor consumer adoption of mobile wallets. See the left side of the picture (the one from Gartner) - biggest category of users across all types of stores is the ones who have never used their wallets. Obviously, much touted security aspects of wallets such as tokenization haven't convinced these users to flip out their mobile wallets at the point of sale.

What I find even more interesting is some industry players touting the need to be "default payment" card in a mobile wallet which by the way, is not used by majority of the users. There are also industry players who believe that they will be able to garner adequate number of users for wallets that support single issuer cards. I believe that all these assumptions may present a short window of opportunity as digital consumers have changing needs and a high degree of choice in fulfilling those needs. Also conventional marketing wisdom tells us that "one size does not fit all".

Look at the right side of the picture from CEB Tower Group. It shows clearly that it is not very hard for a mobile consumer to manage multiple financial apps/ relationships. This clearly means that one smartphone could have multiple card-wallet combinations. In such a scenario, how does a payment card or a mobile wallet continue to be the "preferred" choice?

Issuers need to understand cardholder preferences deeply and design rewards and loyalty programs that are attractive for their target consumer segments. Ideally these reward programs should work across payment rails. After all, a digital wallet may not recommend only cards all the time. It could even recommend non-card payment services in some contexts.

Wallet providers should incorporate more intelligence in wallets that help users with contextual advice on offers as well as which payment method to use for the intended expense or payment. It is also conceivable that virtual wallet assistants will emerge and try to help users to figure out which wallet/ card to use.

As the intelligence and real time data processing capabilities of these wallets and assistants grow, it will get harder and harder to assume that being the "default" card or "default" wallet for the user will continue to yield transaction volume and growth.