Digital Payment Market Size, Share & Trends Analysis Report By Deployment (Cloud, On-premise), By Solution (Payment Gateway, Payment Processing), By Mode of Payment, By Enterprise Size, By End-use, And Segment Forecasts, 2023 - 2030

Report Overview

The global digital payment market size was valued at USD 81.03 billion in 2022 and is expected to expand at a compound annual growth rate (CAGR) of 20.8% from 2023 to 2030. The global digital payments transactions were valued at over USD 8 trillion in 2022. The worldwide increase in customer preference for real-time payments is one of the major factors driving the market growth. According to statistics provided by McKinsey & Company, India registered 25.6 billion real-time transactions in 2020, witnessing a 70% increase from 2019. The increasing adoption of mobile wallets can be attributed to this significant rise in the use of real-time payments in the country. E-commerce service providers are making efforts to strengthen their competitive positions by moving from traditional credit card and consumer finance solutions toward customer engagement solutions that leverage digital payments.

E-commerce companies are also making efforts to deploy their point-of-sale systems to expand their offerings in the digital payment space. For instance, retail giants, such as Shopify and Amazon, are developing point-of-sale systems capable of handling online and in-store transactions. These developments are encouraging banks to improve their digital payment services to preserve their market positions. Government bodies across the world are increasing the limit of contactless payment cards, creating new growth opportunities for market.

For instance, in October 2021, the Treasury and Financial Conduct Authority (FCA) increased the contactless payment limit from USD 50.92 to USD 113.16 in the U.K. This limit was previously increased by FCA from USD 33.95 to USD 50.92 in April 2020 as a COVID-19 measure to reduce contact between payment terminals and shoppers. The growing adoption of 5G network worldwide is also expected to drive market growth. Strong network connectivity enables people to seamlessly make payments and buy products online using mobile devices.

Moreover, enhanced 5G connectivity also helps digital payment service providers implement fraud prevention measures more effectively. According to the GSM Association, 5G network is expected to cover nearly one-third of the world’s population by 2025. Transportation and logistics companies are entering into partnerships with digital payment solution providers to leverage the technology for maintaining social distancing amid the COVID-19 pandemic. For instance, in April 2021, Eurowag, a commercial transport solution provider, invested in Drivitty, a mobile service integrator. Through this partnership, the former company aims to provide vehicle fleet management to its customers.

COVID-19 Impact Analysis

The COVID-19 pandemic has positively impacted the market, leading to a steep rise in online sales and the increasing use of online payment solutions. Customers across the world have shifted from offline shopping to online shopping during the pandemic. According to Digital Commerce 360, a media organization, online sales in the U.S. valued at nearly USD 204.62 billion in Q3 2021, an increase of 6.8% compared to Q3 2020. Lingering customer anxiety over being in crowded places amid the pandemic is driving demand for online retailing.

Solution Insights

The payment processing segment dominated the market in 2022 and accounted for more than 26.0% share of the global revenue. The increasing preference for online shopping across the globe is prompting retailers to adopt payment processing solutions to provide customers with seamless checkout experiences. Players providing payment processing solutions focus on mergers and acquisitions and partnerships to strengthen their market presence. For instance, in October 2021, PXP Financial Inc., a payment processing service provider, announced its partnership with Shift4, a payment processing solution provider.

Through this partnership, the former company expanded its capabilities in the U.S. market. The payment gateway segment is anticipated to grow at the fastest CAGR over the forecast period. Payment gateway solutions are in demand among merchants as they enable convenient payment. Furthermore, payment gateways are used for in-store payments to allow customers to make payments via smartphones and the internet. Thus, the growing adoption of payment gateways among the in-store retail shops drive the segment growth.

Mode Of Payment Insights

The point of sales segment dominated the market in 2022 and accounted for more than 51.0% share of the global revenue. Point of sale systems are used by retail stores for processing transactions. These systems offer benefits, such as fast checkout options, customized customer experience, and multiple payment options. Retailers worldwide adopt cloud-based points of sales systems to increase their efficiency and improve service effectiveness.

The net banking segment is expected to register a significant growth rate over the forecast period. The benefits offered by net banking, including improved time efficiency, ease of banking, and activity tracking, are among the major factors driving the segment growth. As a result, various countries across the world are witnessing an increase in net banking users. According to the statistics provided by eMarketer, approximately 80% of U.S. internet users accessed their bank accounts digitally in 2020.

Deployment Insights

The on-premise segment dominated the market in 2022 and accounted for more than 64.0% share of the global revenue. The on-premise deployment of digital payment provides organizations with complete control over applications and systems, which can be easily managed by the organization’s IT staff. Moreover, the increased frequency of financial frauds amid the COVID-19 pandemic is also one of the major factors driving the demand for on-premise solutions among organizations. According to the statistics provided by Merchant Savvy, a merchant service provider, global payment fraud increased from USD 9.84 billion in 2011 to USD 32.39 billion in 2020; it is projected to reach USD 40.62 billion by 2027, a 25% increase from 2020.

The cloud segment is anticipated to grow at the highest CAGR over the forecast period. The continued rollout of smart city projects, coupled with the rising number of unmanned retail stores, is one of the major factors driving the growth of the segment. Furthermore, efforts taken by payment companies to integrate artificial intelligence features in their payment system are expected to accentuate the segment growth. For instance, in October 2021, Mastercard, a financial service provider, and Previse, an AI-powered payments company, announced the integration of Mastercard Cross-Border Services, a payments platform, into Previse’s InstantPay platform. This collaboration will help the companies to pay their suppliers instantly across the globe.

Enterprise Size Insights

The large enterprise size segment dominated the market in 2022 and accounted for more than 59.0% share of the global revenue. Large retail stores increasingly demand digital payment solutions to enable their customers to conduct payments by maintaining social distancing. Digital payment methods, such as smart banking cards, point of sales solutions, and e-wallets, are used by retailers to reduce checkout time. At the same time, retailers are also focusing on providing innovative payment solutions for customers. For instance, in October 2020, Klarna a financial service provider, announced its partnership with Afterpay, a payment solution provider, to provide Buy Now Pay Later services for online customers.

The small & medium enterprises segment is anticipated to grow at the fastest CAGR over the forecast period. Small & medium enterprises are shifting from paper-based invoicing to digital invoicing as paper-based billing systems are expensive, prone to errors, and inefficient. Payment solution providers are focusing on partnerships with small & medium enterprises to support their digitalization journeys. For instance, in October 2019, Armatic, a solution provider for invoicing automation, was acquired by BlueSnap, a payment technology company. Through this acquisition, BlueSnap enhanced its digital payment solutions.

End-use Insights

The Banking, Financial Services and Insurance (BFSI) segment dominated the market in 2022 and accounted for more than 23.0% share of the global revenue. The rising demand for digital remittance for cross-border and domestic transactions is encouraging banks to adopt digital payment solutions. Moreover, banks are also enhancing their offerings to compete with digital payment solutions providers, such as Google, Amazon, and Facebook. For instance, in June 2019, the Bank of America introduced a digital debit card to offer improved convenience to its clients.

The retail & e-commerce segment is anticipated to register the fastest growth over the forecast period. The growing use of mobile-based payment solutions among customers for retail payments is one of the major factors driving the segment growth. At the same time, the rising number of unmanned retail stores worldwide is also driving the market growth. According to a study conducted by Televisory, a financial service provider, China’s unmanned retail industry reached USD 503.25 million in 2020.

Regional Insights

North America dominated the global market in 2022 and accounted for the largest revenue share of over 34.0%. The regional market benefits from factors, such as the increasing deployment of and technology enhancements in smart parking meters. For instance, in July 2020, ParkMobile, a parking solution provider, announced its partnership with EasyPark, a facilities service provider. Through this partnership, the former company provided contactless payments facility throughout Vancouver city. Moreover, the growing number of unmanned stores in the U.S. is creating the demand for digital payment solutions.

For instance, in November 2019, Ahold Delhaize, a Netherlands-based supermarket, announced the opening of its cashier-less store in the U.S. Europe is expected to witness significant growth over the forecast period. Banks in Europe are making efforts to launch a European payment initiative aimed at creating a unified payments solution for merchants and consumers across the region. Such initiatives are expected to create new growth opportunities for the market over the forecast period. Moreover, the digital campaign launched by the Italian government to increase electronic payments in the country is also propelling the regional market growth.

Key Companies & Market Share Insights

The competitive landscape of the market is highly fragmented. Market players are focused on strategies, such as partnerships, joint ventures, product innovation, research & development, and geographical expansion to strengthen their market positions. Merchants adopt on-premise digital payment solutions due to security-related benefits, such as improved security levels and thereby increased level of customer satisfaction. Market players are focused on enhancing their product offerings to better cater to the changing needs of users and stay competitive.

For instance, in October 2020, Aliant Payments announced that the CryptoBucks cryptocurrency payment mobile app powered by Aliant Payments has added XRP an open-source independent digital asset to its platform. XPR would be available for both Android and iOS mobile apps. With the addition of XRP, the CryptoBucks app would allow merchants to accept Bitcoin Cash, Bitcoin, Ethereum, and Litecoin payments both online and in-store. Some of the prominent players in the global digital payment market are:

• Aliant Payments

• Aurus Inc.

• Adyen

• Financial Software & Systems Pvt. Ltd.

• PayPal Holdings Inc.

• Novatti Group Pty Ltd.

• ACI Worldwide, Inc.

• Global Payments Inc.

• Wirecard

• Authorize.net

• Total System Services, Inc.

Digital Payment Market Report Scope

Segments Covered in the Report

The report forecasts revenue growth at global, regional, and country levels and provides an analysis of the latest industry trends in each of the sub-segments from 2017 to 2030. For the purpose of this study, Grand View Research has segmented the global digital payment market report based on solution, mode of payment, deployment, enterprise size, deployment, end use, and region:

• Solution Outlook (Revenue, USD Billion, 2017 - 2030)

  • Application Program Interface

  • Payment Gateway

  • Payment Processing

  • Payment Security & Fraud Management

  • Transaction Risk Management

  • Others

• Mode of Payment Outlook (Revenue, USD Billion, 2017 - 2030)

  • Bank Cards

  • Digital Currencies

  • Digital Wallets

  • Net Banking

  • Point of Sales

  • Others

• Deployment Outlook (Revenue, USD Billion, 2017 - 2030)

  • Cloud

  • On-premise

• Enterprise size Outlook (Revenue, USD Billion, 2017 - 2030)

  • Large Enterprises

  • Small & Medium Enterprises

• End-use Outlook (Revenue, USD Billion, 2017 - 2030)

  • BFSI

  • Healthcare

  • IT & Telecom

  • Media & Entertainment

  • Retail & E-commerce

  • Transportation

  • Others

• Regional Outlook (Revenue, USD Billion, 2017 - 2030)

  • North America

    • U.S.

    • Canada

  • Europe

    • Germany

    • U.K.

  • Asia Pacific

    • China

    • India

    • Japan

  • Latin America

    • Brazil

  • Middle East & Africa