The benefits of digital payments have always been there for businesses and consumers: It’s fast, secure, and easy to use. But since the COVID-19 pandemic paralyzed the world over a year ago—with a series of lockdowns and social distancing measures—e-wallets and other forms of contactless payments have become increasingly popular. Suddenly consumer behaviour changed, and merchants had no choice but to move their operations online and offer alternative methods of payment to adapt. The big question at this stage is whether this shift is temporary or if digital payments are here to stay.
At the end of March, the Italian investment firm Finaria published a study largely based on data gathered by Statista at the beginning of 2021, featuring statistics that clearly show that digital payments will grow steadily in the next five years, and not just in China. Here are some highlights from the Finaria report:
- In 2017, the global digital payments sector was worth over $3 trillion USD. At the end of 2019 it reached $4.7 trillion, a 55% increase in just two years, and went up to $5.4 trillion in 2020.
- Global digital payments will continue to grow steadily in 2021, with a forecasted transaction value $6.6 trillion, and are expected to reach $10.5 trillion by 2025.
- The growth in global digital payments in 2020 was driven by the increase of digital commerce sales worldwide. The global digital commerce segment, including e-Commerce, e-Travel, and other e-Services, is set to become the biggest chunk of the digital payments market with a forecasted value of $5.8 trillion by 2025.
- Mobile POS payments are also expected to play a substantial role in the growth of digital payments in 2021, with almost 37% ($2.5 trillion) of the digital payments value.
- China is currently the largest mobile payments market in the world with 987 million digital payment users and is expected to reach a $2.9 trillion transaction value in 2021.
- The US digital payments market currently sits in second place with $1.26 trillion worth of digital payments, 22.6% more than a year ago.
- Europe is on its way to achieving a 28.3% growth in 2021, reaching $1.17 trillion in digital payments transaction value.
- By 2025, the European digital payments market, with the U.K. and Germany as its leaders, is expected to reach a total transaction value of $1.95 trillion.
- By 2025, there will be over 1.2 billion digital payment users in China.
In the light of those results, it’s safe to say that digital payments are now more than a Chinese phenomenon. Of course, the pandemic will have played a big role, but the strength of mobile payments goes beyond that. In the West, big names like Amazon, PayPal, Apple, and Facebook are investing massively in the development of online shops and digital payment solutions, and in China, the closely intertwined worlds of e-Commerce and mobile payments never cease to innovate with livestreaming shopping and other trends that create one simple and secure shopping ecosystem for customers and merchants alike. Digital payments simply have all the ingredients to withstand change regardless of the context.
At OTT Pay, we understand the importance of pivoting to products and services that help merchants adapt to immediate change and remain successful in the long run. We believe that digital payments are your gateway to the Chinese consumer market but also to mainstream customers. We also believe that digital payments have enormous value for your business and should be at the centre of your overarching marketing and sales strategy.
If you’re ready to embrace digital transformation and accept popular mobile payment apps like Alipay, WeChat Pay, and UnionPay, contact our Customer Support team today for a free consultation at info@ottpay.com or call us at 1-800-688-9838.