Governments are incorporating digital payment choices to create a digitalised, cashless society.
Bring your own device (BYOD), a surge in smartphone usage, and a large number of people without bank accounts are some of the key variables that are likely to provide profitable development prospects for digital payments.
In addition, stores and services around the world are rapidly adopting and integrating mobile payment apps like PayPal, Samsung Pay, Apple Pay, AliPay, and WeChat Pay. These apps accept electronic payments.
Data Bridge Market Research estimates that, as of December 2019, there were approximately 4,5-billion active internet users worldwide, demonstrating the vast number of individuals who use the internet. The ever-increasing use of the internet has generated a massive market for digital payment solution providers.
The global digital payment market was valued at $81,07-billion in 2021 and is expected to reach $272,64-billion by 2029, registering a CAGR of 16,37% during the forecast period of 2022-2029.
Demand for digital transactions is expected to rise over the forecast period due to the increased use of credit cards, debit cards, digital currencies, mobile wallets, net banking, point of sale, and the growing popularity of mobile apps.
Post-Covid-19, widespread acceptance of digital payment systems is projected to augment and play a big part in the long-term market environment. Because cash has the potential to spread the virus, regulatory bodies and governments discourage its use. For instance, cash used in the UK has been cut in half in recent days as a result of the government-imposed shutdown, and critical goods stores are increasingly avoiding cash transactions.
Various mobile payment vendors in the market are expected to focus on increasing their user base and returns post-Covid-19 scenarios. As a result, vendors are offering benefits, offers, and waiving their fees for using their services.
Data Bridge Market Research segments the global digital payment market into eight notable segments which are offering, deployment model, organisation size, mode of payment, mode of usage, technology, use case and end user.
On the basis of component, the market is segmented into solution and services. In 2021, solutions segment dominated the global digital payment market with 85,77% market share as solutions require high initial investments and services are secondary features after solution installations.
On the basis of deployment model, the market is segmented into cloud, and on premises. In 2021, on premises segment dominated the global digital payment market with 76,75% market share as major payment providers prefer on premises installations, however cloud segment is growing at higher rate due to requirement for specific expenditure feature.
On the basis of organization size, the market is segmented into large enterprises, and small & medium enterprises (SMEs). In 2021, large enterprises segment dominated the global digital payment market with 73,9% market share as only these organizations prefer on-premises deployment methods, however small & medium enterprises (SMEs) is growing at higher rate considering higher cloud applications by these organisations.
On the basis of mode of payment, the market is segmented into payment cards, point of sale, unified payments interface (UPI) service, mobile payment, and online payment. In 2021, payment cards segment dominated the global digital payment market with 32,41% market share as most of the digital transactions worldwide are done by making payments through cards, the payment cards being generally used at shopping websites, marts, gas stations and others.
On the basis of mode of usage, the market is segmented into mobile application, and desktop/web browser. In 2021, mobile application segment dominated the global digital payment market with 76,89% market share as mobile applications are feasible to use anywhere due to compactness of device and ease of operation using application.
On the basis of technology, the market is segmented into application programming interface (API), data analytics and ML, digital ledger technology (DLT), AI and IoT, and biometric authentication. In 2021, application programming interface (API) segment dominated the global digital payment market with 27,97% market share as it is easier and the safest technology for banking operations, also information distribution amongst other systems is smoother using API.
API segment dominates
The API segment emerged as the dominating segment technology segment. This is because of the growing number application programming interfaces (API) in the market especially in the developing economies. Further, growth and expansion of research development services on a global scale will further bolster the growth of this segment.
On the basis of use case, the market is segmented into person (P/C), merchant/ business, and government. In 2021, person (P/C) segment dominated the global digital payment market with 49.70% market share as digital transactions are rapidly being adopted by personal account holders to avoid handling cash and adopt safer as well as quicker mode of transaction.
On the basis of end user, the market is segmented into commercial, and consumer. In 2021, commercial segment dominated the global digital payment market with 69,40% market share as banking, financial services and insurance (BFSI), retail and e-commerce have major applications of digital payment as digital transactions are more in numbers.
The commercial segment emerged as the dominating segment under end user with approximately 69,40% market share. This is because of the growing number of infrastructural development activities in the market especially in the developing economies. Further, growth and expansion of the semiconductors industry all around the globe will further bolster the growth of this segment.