Friday, November 13, 2020
Acumen projects the global payment processing solutions market will expand at a combined annual growth rate of about 15.2 percent over the next seven years to reach $102.3 billion by 2027.
The North American market will account for “significant revenue share” in the global market, according to Acumen, as preferences grow for online and mobile payments, and the availability of mobile phones and advanced safe IT infrastructures make these all the more appealing to traditional card payments. “Rapid digitization across the globe, increasing preference for online payment, and players focused on providing enhanced service in order to enhance the consumer experience are major factors expected to drive the growth of global market,” the firm said in a statement.
The trend toward digitalization appears to have been accelerated by the COVID-19 pandemic. Data recently compiled by global processing company Paysafe revealed that 39 percent of businesses have seen transaction volumes increase, but only 17 percent attributed the growth to in-store sales. Most sales lifts are due to online ordering. In fact, 38 percent of merchants polled by Paysafe that didn’t previously have an online presence said they had launched online ordering and checkouts since the pandemic began.
Meanwhile among consumers recently surveyed by The Strawhecker Group and Visa Consulting & Analytics, 34 percent expect to use mobile or digital wallets more due to the pandemic. Appetize, an enterprise commerce platform for food and beverage, and general retail, has said its research reveals that about one in two American consumers now uses a mobile phone to pay for purchases several times a week.
Acumen said it expects to see rapid growth in payment solutions spend in Asia Pacific, driven in large part by expanding Internet access and smartphone penetration. Additionally, flourishing business activities in the region, a rising number of small and mid-sized businesses, increased global trade activities, and innovations by payments companies will boost transaction numbers, particularly for alternative payment solutions.
Visa, for example, has been testing a new solution it calls Tap to Phone, a mobile app that transforms Android smartphones and tablets into contactless, tap-to-pay software-based POS devices. No additional hardware is required. Tap to Phone leverages NFC technology, which is a standard feature on about 2.5 billion smartphones in use today, according to the NFC Forum.
With tap to Phone, business owners download the app and after registering and selecting their participating bank, and start accepting contactless payments in just a few minutes. Tap to Phone builds on top of the security of an EMV chip transaction, in which each transaction contains a dynamic cryptogram that cannot be reused, Visa stated.
Tap to Phone is now being rolled out in 15 countries, with an emphasis on European and emerging markets, Visa said in a statement. It should also become available for small and micro-merchants in the U.S. in the next year or two.
Visa said it has seen enormous growth in tap-to-pay transactions globally. Year-over-year growth so far has been 40 percent. Among consumers recently surveyed by Visa, 48 percent said they would stop shopping at a store that offers only payment methods that require contact with a cashier or shared machine, such as a card reader.
“With billions of phones around the world at the ready, the opportunity that comes with lighting them up as payment acceptance devices is enormous,” said Mary Kay Bowman, global head of buyer and seller solutions at Visa. “Visa Tap to Phone could be one of the most profound ways to reinvent the physical shopping experience.”
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