Top Up
Money is loaded from a card on the payment provider's own secure page. Card details never reach us. The balance moves once the provider confirms the payment, and from then on it is inside the loop.
Closed-loop wallet
Value that stays in your ecosystem.
A closed-loop wallet holds money inside the product it was loaded into. Your customers top up, pay each other and pay you without the balance leaving for a bank in between every step.
Closed loop is not a cage. Money can always leave: a withdrawal goes to a bank account, or comes out as cash at an ATM with a PIN sent by SMS. A person checks every withdrawal before it is released.
A wallet screen showing a balance, this month's movement and three actions.
The term
What closed loop means.
Closed loop describes where value can be spent, not whether it can be withdrawn.
In an open-loop arrangement, value is spendable anywhere the network reaches. A card is the familiar example: it works at any merchant that accepts the scheme, and the business that issued it has no say in where it is used.
In a closed loop, value is spendable inside a defined set of places. A wallet in your app is spendable with you and with the businesses trading inside your product. That boundary is the point. It means a top up is money arriving in your economy rather than passing through it, and a refund can go back to a balance that is still yours to serve rather than back to a card.
What closed loop does not mean is that money is stuck. Somebody who wants their balance out gets it out, and the route is documented below. A wallet that could not release money would not be a wallet.
Inside the loop
Three things happen without leaving.
These are the movements a closed loop is for. Each one settles inside your product, against a ledger you can read.
Payment
Your app asks for a payment and your customer approves it in the wallet. One payment can be divided between several parties as it is made, and the parts must add up to the amount paid.
Transfer
Wallet to wallet with a reference, between two people in your product, with no card and no bank in the middle. Transfers are instant, and they cannot be reversed.
The exit
How money leaves.
A closed loop has a door. Saying so plainly is part of the design, because a balance somebody cannot get out of is not one they will put money into.
- To a bank account. A withdrawal goes to the wallet holder's own linked account.
- Or as cash at an ATM. With a PIN sent by SMS, for somebody who would rather have notes than a bank transfer.
- A person checks it first. Money does not leave automatically. Every withdrawal is reviewed and evidenced by a named person before it is released.
- Timing is stated, not implied. Withdrawals are manually reviewed and typically processed within 1 to 3 business days.
That review is deliberate friction on the one movement where speed is worth least and mistakes cost most. Everything inside the loop is instant. The thing that empties a wallet is not.
Closed against open
Which one your product needs.
The question is not which is better. It is whether the value you are issuing belongs to your economy or to a network.
If what you need is for a customer to pay anyone, anywhere, you are describing an open-loop instrument and a card scheme is the way to get it. Nothing on this page competes with that.
If what you need is for value to circulate between the people already in your product, a closed loop is the shape that fits. Store credit, a guest balance, an allowance, earnings owed to a contractor, a share of a payment owed to a seller: none of those want to be spendable at an unrelated merchant. They want to be held, divided correctly and spendable with you.
A closed-loop wallet is also not a bank account and not a card gateway. It is the layer that holds and moves money between the people in your product.
Where it runs
One currency per wallet.
A wallet holds one currency, set when it is opened. Wallets run today in ZAR, GBP, EUR and AED, and each deployment is configured for its country, currency and language.
The wallet is live in production in South Africa, inside connected applications on web and mobile.
Questions
What people ask about closed loop.
What is a closed-loop wallet?
A wallet whose balance is spendable inside a defined set of places rather than anywhere a card network reaches. In a DigiWise wallet that set is your own product and the businesses trading inside it. Money can still be withdrawn to a bank account or taken as cash at an ATM.
Does closed loop mean money cannot be withdrawn?
No. A withdrawal goes to the holder's own bank account, or comes out as cash at an ATM with a PIN sent by SMS. A person checks every withdrawal before it is released, and withdrawals are manually reviewed and typically processed within 1 to 3 business days.
How is this different from an open-loop card?
An open-loop instrument is spendable anywhere the network reaches, and the issuer has no say in where. A closed loop keeps value spendable inside your product, which is what makes store credit, guest balances and seller shares behave the way those things are meant to behave.
Is a closed-loop wallet a bank account?
No. A wallet is not a bank account and it is not a card gateway. It is the layer that holds and moves money between the people in your product.
Work out whether the loop fits.
Tell us where money enters your product and who is owed out of it. We will tell you what a closed loop would and would not solve.