Payment As A Service Market Size, Share & Trends Report

Payment As A Service Market Size, Share & Trends Analysis Report By Component (Platform, Services), By Services, By Industry Vertical (Retail & Ecommerce, Travel & Hospitality, Healthcare, BFSI), By Region, And Segment Forecasts, 2020 - 2027

  • Published Date: Jun, 2020
  • Base Year for Estimate: 2019
  • Report ID: GVR-4-68038-589-2
  • Format: Electronic (PDF)
  • Historical Data: 2016 - 2018
  • Number of Pages: 120

Report Overview

The global payment as a service market size was valued at USD 6.2 billion in 2019 and is expected to grow at a compound annual growth rate (CAGR) of 16.9% from 2020 to 2027. Payment as a Service (PaaS) uses the SaaS model to streamline the payment for the customer. The merchants and Independent Software Vendor (ISV) play a vital role in the process. Digital payments are increasing day by day. Thus, payment service providers are enabling transactions through e-wallet, websites, and other applications. They accept the payment electronically with the help of credit cards, debit cards, or bank transfers. It helps in managing the transactions between a buyer and a seller. The consumers and sellers trust the platform as they offer risk-free and secure payment transactions and safeguards the payment information.

U.S. payment as a service market size

The payment industry has undergone a drastic change, and the traditional payment modules have been replaced by the new modules where the payment is just a click away. PaaS is not only altering the merchant landscape; however, banks are identifying that the increase in PaaS adoption is an opportunity to provide a trustworthy option for their customers. The financial crisis in 2008 has led to imposing new regulations on the banks to restructure their old model instead of developing a completely new model. Thus, after the integration of PaaS into their practice, banks have realized the probable solutions that are scalable, secure, and can process numerous transactions at reduced costs.

The increase in the transition from an on-premise model to a cloud-based service model is the other factor contributing to market growth. Payment providers are increasingly transforming their traditional physical servers and on-premise model to cloud-based deployment to reduce operating costs and provide products at a faster rate. The shift in the cloud deployment model has increased the development of alternate omnichannel solutions and digital wallets.

Amidst the ongoing COVID-19, the cash transactions have drastically reduced. Thus, the pandemic has resulted in increasing mobile payments. As a result, consumers have adopted different digital and contactless payment technologies such as e-wallets for the transactions. Despite of the virus outbreak, the consumers tend to buy essential needs such as groceries and medical supplies. Digital wallets play a crucial role for the sellers and the consumers. These wallets store the payee’s information and eliminate the need to carry physical wallets and cash, hence reducing the outspread and driving the market.

Component Insights

The platform segment held the largest market share of more than 83.0% in 2019. The platform segment includes merchant financing, regulatory compliance, security and fraud detection, payment applications, and gateways. Executing payments is not a part of the business for retail, e-commerce, banking, healthcare, and other industries. Therefore, integration of payment platforms with online stores has remained an important factor for several industries. The payment service providers thus provide the required payment platforms, security and fraud detection, and payment gateways to these industries. In addition, AI and machine learning-based solutions are provided for fraud prevention and risk management.

The services segment is expected to grow at the highest rate over the forecast period. The segment includes professional services and managed services. Managed services help in enhancing the customer experience, thus allowing the companies to focus on the core business process. They offer skills required to update the API based payment platforms. In addition, other customer requirements are also fulfilled with the help of these services.

Services Insights

The professional services segment held the largest market share of over 67.0% in 2019. The professional services include consulting, training, maintenance, integration, and deployment. The rising demand for API based services along with transformation of traditional checks to digital payment is anticipated to fuel the growth of the segment from 2020 to 2027.

The managed services segment is expected to witness the highest CAGR of 7.9% from 2020 to 2027. Companies are actively looking to serve through managed services, simultaneously focusing on their core businesses. Such services help in reducing the operational costs as well as the infrastructure complexity, thereby providing a secure infrastructure. Companies providing managed services offer a complete package of solutions to its customers, thus enabling excellent customer experience management.

Industry Vertical Insights

The retail and ecommerce segment held the largest share of more than 40.0% in 2019. The industry vertical segment analyzed in the study includes retail and ecommerce, travel and hospitality, healthcare, BFSI, and others. The increasing trend of online shopping and rapid adoption of SaaS have led to an increase in the implementation of payment services. Consumers prefer a safe and secure platform to pay for their purchases. In addition, the retailers have adopted new technologies such as Artificial Intelligence (AI) and digital stores to increase the presence and visibility in the market. Payment through e-wallets, credit cards, debit cards, and online banking has reduced the transaction time, improved operational efficiency, and reduced the operating cost.

Global payment as a service market share

The healthcare segment is expected to witness the highest CAGR from 2020 to 2027. The increase in healthcare spending on medicines, and other medical supplies and equipment, is expected to drive the market over the forecast period. The outbreak of the COVID-19 has impacted the majority of population and countries across the globe, thereby driving the payment as a service market.

Regional Insights

North America held the largest share of more than 29.0% in 2019, owing to the highest adoption of the payment as a service model over traditional models in the region. North America is a hub for the number of small enterprises/startups, medium, and large enterprises. According to the World Payments report 2019, the number of non-cash transactions in the region has remained the highest and grew at a rate of 5.4% from 2013 to 2017. U.S. has the highest penetration of digital payment instrument, therefore accounting for the majority of share in the region in 2019. Google Pay, Apple Pay, and Paypal are the leading digital payment applications offered by the U.S. companies.

Asia Pacific is expected to emerge as the fastest-growing market over the next seven years. The growing retail sector in China, India, and Japan, and the presence of the majority of small and medium scale retail enterprises in the region is anticipated to boost the growth of the market in region. The predominant use of payment apps such as Alipay and WeChat Pay is expected to drive the market over the forecast period. These apps provide quick payments, further reducing the time taken for the transaction. The government of China has destroyed the banknotes to mitigate the spread of the coronavirus specifically in the containment zones. Thus, the consumers have effectively implemented the use of e-wallets, and payment apps for purchasing essentials, household goods, and medical supplies in the region.

Key Companies & Market Share Insights

Key companies offer various platforms and services and provide guarantees for risk-free operations. The companies are mainly involved in mergers and acquisition to sustain their position in the market. For instance, in May 2019, Global Payments Inc. merged with TSYS to provide solutions on payment technologies. In January 2019, First Data was acquired by Fiserv Inc. Some of the prominent players in the payment as a service market include:

  • PaySafe
  • Agilysys Inc.

  • First American Payments Systems

  • Alpha Fintech

  • Aurus

  • Ingenico

  • First Data (Fiserv Inc.)

  • Pineapple Payments

  • TSYS (Global Payments Inc.)

  • Verifone

Payment As A Service Market Report Scope

Report Attribute

Details

Market size value in 2020

USD 8.6 billion

Revenue forecast in 2027

USD 25.7 billion

Growth rate

CAGR of 16.9% from 2020 to 2027

Base year for estimation

2019

Historical data

2016 - 2018

Forecast period

2020 - 2027

Quantitative units

Revenue in USD Million and CAGR from 2020 to 2027

Report coverage

Revenue forecast, company share, competitive landscape, growth factors and trends

Segments covered

Component, services, industry vertical, region

Regional scope

North America, Europe, Asia Pacific, Rest of the World

Country scope

U.S., Canada, U.K., Germany, China, India

Key companies profiled

PaySafe; Agilysys Inc.; First American Payments Systems; Alpha Fintech; Aurus; Ingenico; First Data (Fiserv Inc.); Pineapple Payments; TSYS (Global Payments Inc.); Verifone

Customization scope

Free report customization (equivalent up to 8 analyst’s working days) with purchase. Addition or alteration to country, regional & segment scope.

Pricing and purchase options

Avail customized purchase options to meet your exact research needs. Explore purchase options


Segments Covered in the Report

This report forecasts revenue growth at the global, regional, and country levels and provides an analysis of the latest industry trends in each of the sub-segments from 2016 to 2027. For the purpose of this study, Grand View Research has segmented the global payment as a service market report on the basis of component, organization, Industry vertical, and region:

  • Component Outlook (Revenue, USD Million, 2016 - 2027)

    • Platform

    • Services

  • Services Outlook (Revenue, USD Million, 2016 - 2027)

    • Professional Services

    • Managed Services

  • Industry Vertical Outlook (Revenue, USD Million, 2016 - 2027)

    • Retail & ecommerce

    • Travel & Hospitality

    • Healthcare

    • BFSI

    • Others

  • Regional Outlook (Revenue, USD Million, 2016 - 2027)

    • North America

      • U.S.

      • Canada

    • Europe

      • U.K.

      • Germany

    • Asia Pacific

      • China

      • India

    • Rest of the World

Frequently Asked Questions About This Report

Pricing & Purchase Options

Buy Chapters or Sections

Avail customized purchase options to meet your exact research needs:

  • Buy sections of this report
  • Buy country level reports
  • Request for historical data
  • Request discounts available for Start-Ups & Universities

Why Choose Us

  • Research support

    24/5 Research support

    Get your queries resolved from an industry expert.

  • Custom research service

    Custom research service

    Design an exclusive study to serve your research needs.

  • Quality assurance

    Quality assurance

    A testimonial for service in the form of BBB "A" Accreditation.

  • BBB Rating dandb
  • Information security

    Information security

    Your personal and confidential information is safe and secure.

  • grand view research PCI DSS complaint grand view research paypal verified