GVR Report cover Payment Gateway Market Size, Share & Trends Report

Payment Gateway Market Size, Share & Trends Analysis Report By Type (Hosted, Non-hosted), By Enterprise Size, By End Use (BFSI, Retail & E-commerce), By Region, And Segment Forecasts, 2021 - 2028

  • Published Date: Jun, 2021
  • Base Year for Estimate: 2020
  • Report ID: GVR-4-68038-511-3
  • Format: Electronic (PDF)
  • Historical Data: 2016 - 2019
  • Number of Pages: 130

Report Overview

The global payment gateway market size was valued at USD 18.21 billion in 2020 and is expected to expand at a compound annual growth rate (CAGR) of 21.7% from 2021 to 2028. The growth can be attributed to the advancements in mobile payment technology and an increase in the use of mobile wallets. Increasing penetration of the internet and smartphones is one of the major factors driving the market growth. Payment gateway systems are widely used in cashless transactions as they include effective alert mechanisms that detect suspicious offline and online events. The adoption of technologies such as the Internet of Things (IoT) and Artificial Intelligence (AI) has also resulted in the automation of cashless transactions. These technology-integrated systems enable businesses to make more informed decisions. One of the important aspects of businesses is the integration of gateway systems as it supports data transfer for transactions between the bank and the payment portal. These systems enable businesses such as online retail platforms or brick and mortar stores to collect cash through a bank chosen by the customer without compromising on sensitive information.

U.S. payment gateway market size, by type, 2016 - 2028 (USD Billion)

The rapidly increasing internet penetration across the globe is anticipated to fuel market growth over the forecast period. According to the statistics provided by Oberlo, a computer software company, 63.2% of the world’s population had access to internet services in 2019. Besides, the increasing awareness of the ease of online transactions coupled with changing payment preferences of consumers has led to the rapid adoption of online payment methods, in turn propelling the market growth. Nowadays, consumers are increasingly using online payment methods for paying their bills. According to a study conducted by the Federal Reserve Bank of Atlanta, 43.2% of consumers paid their bills online in 2018.

Merchants across the globe are focusing on partnering with payment service providers to expand their businesses in other regions. These partnerships allow merchants to tap opportunities created by the globalization of e-commerce. Merchants manage a large volume of transactions, which has propelled the integration of gateway systems into their sales channels. For instance, in November 2020, Shopify, an e-commerce company, announced its partnership with Alibaba Group Holding Limited, an Alipay payment gateway provider. The company’s payment gateway enables Shopify merchants to seamlessly accept payments in China and, in the forthcoming years, across Asia as well.

Numerous e-commerce vendors are developing their gateway systems combined with eWallet services. This development is mostly identified among merchants handling a large volume of transactions. However, only a few businesses are capable of forming their systems due to high maintenance and development costs and other value-added services. The increasing cases of data breaches and cyberattacks are expected to hinder the market growth over the forecast period.

COVID-19 Impact Analysis

The COVID-19 pandemic has positively impacted market growth. This can be attributed to the rising internet usage, which has subsequently encouraged the use of payment gateways. Moreover, the dependency of individuals on mobile and internet services has increased during this time as it connects them with payment gateways and other online platforms. For instance, during the pandemic, Vodafone, a mobile operator, witnessed a 50% increase in its European data traffic.

Type Insights

The hosted segment led the payment gateway market and accounted for more than 57.0% share of the global revenue in 2020. The demand for hosted payment gateways is increasing among merchants due to the benefits such as high security, reduced merchant liability, and the ready-to-use setups for payments. Merchants are widely adopting this method as it helps them reduce fraudulent activities and focus on their core offerings. Moreover, hosted gateways comply with the Payment Card Industry Data Security Standard (PCI DSS), which makes them a safer option for payment processing.

The non-hosted segment is expected to witness significant growth over the forecast period. Various merchants prefer having full control over their checkout processes and do not want to direct customers from their checkout page. Using APIs, merchants enable customers to enter their debit or credit card information directly on the checkout page and process the payments. Moreover, non-hosted gateways can be integrated with online payment solutions using APIs with any devices, thereby creating growth opportunities for the segment growth over the forecast period.

Enterprise Size Insights

The large enterprise segment led the market and accounted for more than 58.0% share of the global revenue in 2020. Large enterprises are widely adopting payment gateways as they generate a high volume of transactions. Additionally, these enterprises require a highly secure and safe mode of transaction, which is facilitated by payment gateways. These gateways use industry-standard encryption and efficiently protect the sensitive data of customers and merchants, thus creating growth opportunities for the large enterprise segment.

The small and medium enterprises segment is anticipated to register the highest growth over the next seven years. Small and medium enterprises are turning to payment gateways as these systems are faster than manual processing and help customers to make payments without the inconvenience of waiting in long queues. Nowadays, various small and medium enterprises are restructuring their revenue strategies and businesses by moving toward a digital approach. This is expected to spur the growth prospects of the market in the forthcoming years.

End-use Insights

The retail and e-commerce segment led the market and accounted for more than 26.0% share of the global revenue in 2020. The segment growth can be attributed to the rising number of online transactions in retail and e-commerce businesses across the globe. According to the statistics provided by JP Morgan, an investment banking company, card payment dominated in the U.S. in 2019 and was used for 47% of e-commerce transactions. The increasing demand for online retailing across the globe is anticipated to fuel market growth over the forecast period. Retail companies are adding payment gateways to their websites to propel consumers’ orders and build goodwill.

Europe payment gateway market share, by end use, 2020 (%)

The BFSI segment is expected to witness significant growth over the forecast period. The BFSI sector is widely adopting payment gateway systems as they provide an end-to-end ecosystem for financial services. Financial companies are challenged with complex cash flows where cash is collected from numerous sources and routed to various accounts. Gateway systems help financial companies to easily manage money movement from a single dashboard.

Regional Insights

North America led the market for payment gateways and accounted for more than 37.0% share of the global revenue in 2020. This can be attributed to the technological developments and considerable application of payment gateways in various end-use segments. At the same time, the presence of prominent players such as Square; PayPal Holdings Inc.; Mastercard; BluePay; and Amazon Payments Inc. is driving the regional market growth. Moreover, the rising e-commerce sector in the region is also propelling the growth of the market. According to the statistics provided by Digital Commerce 360, a media company, consumers in the U.S. spent USD 861.12 billion on e-commerce witnessing an increase of 44.0% as compared to 2019.

The Asia Pacific region is expected to emerge as the fastest-growing regional market over the forecast period. The growth can be attributed to the several initiatives undertaken by governments to improve the online payment infrastructure in their countries. For instance, in India, the Reserve Bank of India (RBI) has regulated gateways such as Bharat Bill Pay, Paytm, and Mobikwik to enable effective digital payments. The Chinese government is focusing on improving internet access in rural areas, thereby creating growth opportunities for the market.

Key Companies & Market Share Insights

Vendors in the market are focusing on extending their product and service portfolio in untapped industries. For instance, in July 2018, Alibaba Group Holding Limited, an Alipay payment gateway provider, extended its services in London to strengthen its position in the tourist hub. Additionally, in October 2020, Stripe announced the acquisition of Paystack, an online payment processing company. Paystack operates in Nigeria and has plans to expand across South Africa. Paystack works independently and has embedded the services of Stripe with its offerings. Through this initiative, Stripe has expanded its presence in Africa.

Security concerns related to online payments are hindering the growth of the market. This has encouraged various companies to adopt advanced technologies and solutions to curb fraudulent activities. New product developments and collaborations are some of the key strategies adopted by players to gain a competitive edge in the market. For instance, in April 2019, Stripe acquired Touchtech Payments, a startup in Ireland, which works with banks to help them manage and develop the verification process. This acquisition helped Stripe to establish its footprint in Ireland. Some of the prominent players operating in the global payment gateway market are:

  • Adyen

  • Amazon Payments Inc.

  • Authorize.Net

  • Bitpay, Inc.

  • Braintree

  • PayPal Holdings Inc.

  • PayU Group

  • Stripe

  • Verifone Holdings Inc.

  • Wepay, Inc.

Payment Gateway Market Report Scope

Report Attribute


Market size value in 2021

USD 22.05 billion

Revenue forecast in 2028

USD 87.44 billion

Growth rate

CAGR of 21.7% from 2021 to 2028

Base year of estimation


Historical data

2016 - 2019

Forecast period

2021 - 2028

Quantitative units

Revenue in USD billion and CAGR from 2021 to 2028

Report coverage

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

Segments covered

Type, enterprise size, end use, region

Regional scope

North America; Europe; Asia Pacific; Latin America; MEA

Country scope

U.S.; Canada; Germany; U.K.; China; India; Japan; Brazil

Key companies profiled

Adyen; Amazon Payments Inc.; Authorize.Net; Bitpay; Inc.; Braintree; PayPal Holdings Inc.; PayU Group; Stripe; Verifone Holdings Inc.; Wepay, Inc.

Customization scope

Free report customization (equivalent up to 8 analysts 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

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 2016 to 2028. For this study, Grand View Research has segmented the global payment gateway market report based on type, enterprise size, end use, and region:

  • Type Outlook (Revenue, USD Billion, 2016 - 2028)

    • Hosted

    • Non-hosted

  • Enterprise Size Outlook (Revenue, USD Billion, 2016 - 2028)

    • Large Enterprises

    • Small & Medium Enterprises

  • End-use Outlook (Revenue, USD Billion, 2016 - 2028)

    • BFSI

    • Media & Entertainment

    • Retail & E-commerce

    • Travel & Hospitality

    • Others

  • Regional Outlook (Revenue, USD Billion, 2016 - 2028)

    • North America

      • U.S.

      • Canada

    • Europe

      • Germany

      • U.K.

    • Asia Pacific

      • China

      • India

      • Japan

    • Latin America

      • Brazil

    • Middle East & Africa

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