Although many alternative payment methods feel niche today, data shows they will grow steadily through 2020, especially in emerging markets – adding to the fragmentation of today’s global e-commerce landscape.
To help merchants keep up with changes in all the markets they operate in, Worldpay compiled data on payment trends and preferences across 30 countries in its 2016 Global Payments Report – a combination of Worldpay’s own surveys and research, and information from authoritative third-parties, including financial and industry databases.
Here is a preview of some of the report’s key predictions, which all point to merchants needing to expand their payment acceptance options so consumers can pay the way they want to:
The global ecommerce market, including m-commerce, is set to grow at 10.4 percent by 2020: China, the U.S. and the U.K. command today's e-commerce world, but the report indicates the introduction of alternative payment methods has prepared emerging markets to join the race. Asia Pacific and Latin America are currently leading the charge in e-commerce growth, with an annual growth rate of 13 percent and 12 percent respectively – compared to North America, which is growing at a rate of only 7 percent.
India is set to overtake the U.S. as the second largest e-commerce superpower in 2034: While it currently accounts for a small portion of global e-commerce spend, the Indian market is primed for the explosive growth of 28 percent per annum from 2016-2020. Roughly 350 million Indian citizens are already online, and that number is expected to nearly double to 600 million by 2020. Therefore, the potential opportunity for merchants is enormous, particularly for those who offer a mix of payment methods as bank transfers and cash on delivery are the country’s most popular payment options.
By 2020, mobile wallets are expected to grow in market share by 7 percent in the U.S., overtaking both credit and debit cards: APMs are closing in on traditional payments in the U.S. with mobile wallets leading the pack, followed by bank transfers, prepaid cards and prepay, which are all expected to grow by at least 3 percent by 2020. Millennials are a big factor in the transition toward APMs around the world as these payment options are attractive to cost-conscious consumers who are wary of using credit cards and running into debt.
The Global Payments Report provides information on global payment trends, as well as a breakdown of trends and preferences for each country included. To learn more, read the full report or visit www.worldpay.com.