Global Digital Payment Market Overview, 2024-29

Market Dynamic

Market Drivers • Convenience and accessibility: Consumers increasing demand for ease and accessibility is a major driver of the global digital payment business. Digital payment systems provide exceptional ease by allowing consumers to execute transactions at any time and from any location, using their smartphones or other connected devices. With the advent of e-commerce and mobile commerce, consumers want seamless and frictionless payment experiences, which are pushing the adoption of digital payments. Furthermore, digital payments eliminate the need for real cash or checks, which simplifies the process of carrying and handling traditional forms of currency. As a result, customers are increasingly using digital payment solutions for their daily financial activities, which is driving the worldwide digital payment market forward. • Rapid technological advancements: Mobile technological advancements, encryption techniques, and payment processing algorithms have made digital payments more secure, efficient, and trustworthy than ever before. With the advent of technologies such as biometric authentication, tokenization, and near-field communication (NFC), digital payment providers provide higher security features and smoother user experiences, resulting in increased acceptance of digital payment solutions. Furthermore, advances in artificial intelligence, machine learning, and blockchain are creating new opportunities for innovation in the digital payment area, paving the way for the creation of sophisticated payment solutions and services. Market Challenges • Security concerns: One of the most significant difficulties confronting the worldwide digital payment sector is the ongoing threat of security breaches and cyber-attacks. As digital transactions become more popular, so do the hazards of data theft, fraud, and identity theft. Consumers and organizations are concerned about the potential implications of security breaches, which include financial losses, reputational damage, and legal obligations. In order to address these issues, digital payment providers must incorporate robust security mechanisms such as encryption, tokenization, and biometric authentication to protect sensitive financial information and prevent unwanted access. Furthermore, regulatory bodies play an important role in establishing and enforcing security standards that maintain the integrity and trustworthiness of the digital payment system. • Consumer trust and adoption: The global digital payment market faces serious hurdles in terms of customer confidence and acceptance. Despite the ease and efficiency that digital payment solutions provide, many consumers are wary about their security and reliability. Concerns about privacy, data security, and potential fraud hinder some consumers from using digital payments, especially in areas with poor internet access or digital literacy. Market Trends • Mobile wallet adoption: The global digital payment business has experienced a considerable increase in mobile wallet acceptance. With the proliferation of smartphones and the increased convenience they provide, customers are adopting mobile wallet solutions for their daily purchases. This trend is being pushed by factors such as the proliferation of contactless payments, the integration of loyalty programs and rewards, and the expansion of mobile banking services. As more merchants and service providers accept mobile payments, the use of mobile wallets is likely to rise, accelerating the expansion of the digital payment sector. • Emergence of contactless payment: Contactless payments have emerged as a major trend in the worldwide digital payment business. With consumers increasingly valuing hygiene and safety in the aftermath of the COVID-19 outbreak, contactless payment solutions like NFC-enabled cards and mobile wallets have gained popularity as a quick and secure alternative to cash and traditional card payments. This trend is fuelled further by merchants and financial institutions' extensive deployment of contactless payment infrastructure, as well as the expanding acceptance of contactless payments in industries like retail, hospitality, and transportation.

Key Development

• In July 2023, Mastercard announced a collaboration with JazzCash, one of Pakistan's most prominent digital wallet providers, serving over 43 million accounts, to revolutionize digital payments by introducing affordable acceptance solutions. The partners launched QR code payments, Tap on Phone solutions, and Pay by Link to facilitate cost-effective and widespread acceptance for merchants at the bottom of the economic pyramid. • In December 2023, Klarna and Adyen extended global strategic partnership with aim of simplifying payments and improving the customer experience. Payment platform, Adyen, has strengthened its global partnership with Klarna. The BNPL fintech, which now designs itself as an AI powered global payments network and shopping assistant, will benefit from Adyen’s acquiring capabilities to simplify card payments for its 150 million consumers and 500,000 retail partners globally. • In October 2023, Fiserv, Inc., a leading global provider of payments and financial services technology solutions, has partnered with Melio, a leading B2B payments platform, to enable financial institutions to better meet the payments needs of small businesses. CashFlow CentralSM from Fiserv, launched through an exclusive relationship with Melio, would combine the easy-to-use accounts payable and receivable workflows for which Melio is known with the market-leading biller and merchant network and payment capabilities of Fiserv. • In October 2023, Fiserv, Inc., a global leader in payments and financial technology, announced the acquisition of Skytef, primary distributor of Software Express’s SiTef (Solução Inteligente de Transferência Eletrônica de Fundos), from Fiserv, the leading Electronic Funds Transfer solution in Brazil. With the integration of the two companies and the addition of new associates, Fiserv expands its capacity to support large clients with complex after-sales demands.