As platforms scale, they face the growing challenge of managing the flow of money across an expanding network of users, vendors, and service providers. Multi-party payments are no longer simple transactions. They require detailed rules to split funds, apply fees, enforce compliance, and settle in real time across different geographies. On top of this, platforms must deliver seamless payment experiences while dealing with regulatory complexities and operational constraints.
The traditional financial infrastructure wasn’t built for this level of flexibility, leaving platforms to patch together fragmented solutions. Programmable wallets change the game by enabling platforms to automate, customize, and control money movement at scale, turning payments from a pressing challenge into a competitive advantage.
In this article, we provide an in-depth overview of their benefits, exploring how programmable wallets automate payment flows, enable platforms to customize transactions based on their business models, and support faster scaling.
As simple digital versions of physical wallets, digital wallets have primarily focused on allowing users to store payment information and make online transactions. Early examples include online payment systems like PayPal and digital payment networks like Google Wallet.
As payment technology progressed, digital wallets began incorporating more advanced features, transitioning into smart wallets. These wallets integrate with various financial services, allow for bank account connections, support loyalty programs, offer expense tracking, and come with stronger authentication methods for safer transactions.
Even though smart wallets have improved with various features, they do not offer the full capabilities that platforms need to manage and automate money movements - capabilities that programmable wallets provide.
Unlike traditional digital wallets that simply store and facilitate transactions of digital assets, programmable wallets come with built-in automation, smart features, and customizable logic that allow users to execute complex financial actions without manual intervention.
A programmable wallet is a digital financial account that automates money movement based on predefined rules. For example, a programmable wallet embedded in a travel platform could be set up to automatically allocate funds among the key players: the property owner receives their share for rental accommodation, the property manager gets compensated for their services in maintaining and managing the listing, and the booking platform secures its commission fee. A financial platform can automatically transfer a set amount of money into a savings account or investment fund every payday without the need for the user to manually initiate these transactions.
Every user operates within a wallet-based framework, where money movement - deposits, payments, refunds, and conversions - is powered by these wallets, facilitateing fast, error-free transactions.
Unlike traditional payment providers that rely on rigid structures, programmable wallets enable a decoupled system of pay-ins and payouts. Instead of funds being immediately routed through a payment processor and settled in a bank account, they are first stored in wallets. This allows platforms to manage and allocate funds in a flexible way, enabling direct transactions between users without intermediaries. This infrastructure streamlines money movement by giving businesses greater control over how they receive and distribute funds.
A wallet ecosystem extends these capabilities by integrating payments with programmable features. This ecosystem allows businesses to create customized money movement flows, automate transactions, manage FX operations, and design white-labeled payment experiences. As a result, platforms can scale faster while maintaining full control over financial processes.
With programmable wallets, platforms can streamline fund management, reduce manual processes, and create personalized payment experiences for their users. Here are the main benefits.
Platforms can build custom payment flows, and gain greater flexibility and control over money movement. This means they can design and automate transactions based on their operational needs, whether it’s managing payouts, splitting payments, or scheduling transactions.
For payees - fund owners who earn money by providing services or products on a platform - programmable wallets offer greater financial control. An embedded programmable wallet infrastructure allows them to manage their earnings and access funds on demand.
A wallet infrastructure offers streamlined fund movement by collecting funds from multiple sources into a single wallet account that can later be programmed to run split payments and payouts.
Without this infrastructure, platforms must use payment providers' reconciliation solutions or build their own revenue-sharing logic. A wallet infrastructure, on the other hand, being inherently programmable, empowers platforms to design and implement revenue share logic, reducing development and manual efforts compared to its counterparts.
On the operational front, a wallet infrastructure enables platforms to establish multiple wallet accounts for each transaction type, including commission, platform fees, and users’ wallets. It makes it much easier to keep track of where the money is and who it belongs to.
Programmable wallets enable platforms’ users to store, send, receive, convert, and split funds. By automating money movement, these wallets eliminate the need for manual reconciliation, reducing errors and freeing up valuable time for finance and operations teams. Instead of managing complex payout workflows, handling compliance checks, and tracking transactions across multiple systems, teams can rely on programmable wallets to execute rules-based transactions in real time.
Platforms can offer these various payment experiences directly in their interface and build more experiences on top of the wallet infrastructure, such as membership deals, gift vouchers, cash advance, and more, to drive engagement and unlock new revenue streams.
By combining backend efficiency with front-end personalization, Mangopay empowers platforms to automate and control the entire payment process, from collecting funds to distributing payouts, and ultimately achieve sustainable growth. What’s more, all operations are shielded by a proprietary fraud prevention engine with low false positive rates and high fraud detection precision.
Here’s why platforms choose Mangopay’s programmable wallets.
Our API-first approach ensures payments are executed automatically when predefined conditions are met, reducing manual intervention.
Traditional banking systems introduce delays in fund movement. We process transactions instantly, with funds moving between the platform and user wallets in real time.
Platforms can set up dynamic fund allocation, revenue splits, milestone-based payouts, and custom fee structures. Whether it’s splitting payments between multiple parties or adjusting fees based on transaction logic, you’re in control.
With our multi-currency wallets, platforms can convert funds across different currencies without being tied to a fixed exchange point. FX conversions can happen at any stage in the payment flow, giving you complete control over when and how they convert funds.
Our wallets can be linked to virtual IBANs, allowing platforms to manage funds as if they were local accounts with the ability to receive, hold, and send funds from these accounts.
Platforms can continue to work with their payment service providers while unlocking new functionalities from programmable wallets without making any changes to their payments tech stack. Our infrastructure is compatible with multiple acquirers to support various payment methods and operates independently of those collaborations.
Platforms can define fee collection rules based on percentages, transaction types, or specific triggers at any stage of the payment journey.
Mangopay’s programmable wallets come with unlimited wallets, splits, and transfers, custom fee collection, and the option to customize how and when funds are held in a wallet before being released.
Contact us to learn how to make the most of our programmable wallets for automating and customizing your payment flows.
A programmable wallet automates money movement based on predefined rules. It enables platforms to set up custom workflows for payments, fund allocation, and revenue sharing without manual intervention.
Digital wallets like PayPal, Google Pay, and Apple Pay are designed to store payment information and facilitate transactions. They act as intermediaries between users and traditional payment methods like credit cards or bank accounts.
In contrast, programmable wallets are not just storage tools. They actively manage and automate money movement within a platform. They allow businesses to create custom payment flows, split payments between multiple parties, automate fund disbursement and implement dynamic transaction rules. Unlike digital wallets, programmable wallets function as a fully integrated financial infrastructure for platforms, reducing dependency on banks and card networks.
While blockchain-based wallets are one type of programmable wallet, not all programmable wallets rely on blockchain technology. Mangopay’s programmable wallets operate within a centralized infrastructure, offering automation, flexibility, and control over payment flows without relying on blockchain or supporting cryptocurrency transactions.
They eliminate manual processes by automatically collecting, storing, and distributing funds based on preset conditions. This reduces errors, speeds up transactions, and offers financial transparency for both platforms and their users (payers and payees).
Mangopay’s programmable wallets operate within a secure infrastructure, backed by a fraud prevention engine and high fraud detection precision from the moment the user creates an account to the point of checkout and beyond.
Mangopay offers an API-first approach, making it easy to integrate wallets into your existing payment infrastructure. Our solution engineers and fast integration technologies make this possible in a secure, compliant, and non-disruptive way.