ATLANTA, Oct. 31, 2016 (GLOBE NEWSWIRE) -- As e-commerce continues to grow exponentially, alternative payment methods are set to replace card payments by 2020, according to new research by leading payment company Worldpay.
Worldpay’s latest global overview of online payment habits, the Global Payments Report, predicts the global e-commerce market will grow 10.4 percent by 2020. The report, which compiled data from 30 countries, suggests China, the U.S. and the U.K. will continue leading the charge, but the growing fragmentation in global e-commerce will soon change the way these consumers pay – as more niche alternatives like mobile wallets, bank transfers and prepay cards continue to steal market share from more traditional payment options like credit cards.
Though credit and debit cards still dominate more than 50 percent of the market in most countries in 2016, including the U.K., U.S., Brazil and Hong Kong, the report predicts a relative decline in global usage by 2020 – by 4 percent for credit cards and 1 percent for debit cards. Mobile wallets are a close second for many e-commerce superpowers, and already lead in China with 56 percent of market share. For the U.S., mobile wallets are projected to grow by 7 percent, overtaking use of both credit and debit cards by 2020.
Adoption rates for alternative payment methods are predicted to grow slowly but steadily in the next five years, as options including bank transfers (2 percent), prepaid cards (2 percent) and prepay (1 percent) begin to overtake cards, particularly in emerging markets. The Indian e-commerce market, for example, prefers alternative payment methods to cards and is primed for rapid growth. Predicted to grow a massive 28 percent per annum from 2016-2020, India is set to overtake the U.S. as the world’s second largest e-commerce market by 2034 at $2,039bn. The most popular payment method in India in 2016 is bank transfers at 27 percent, followed by cash on delivery at 22 percent. By 2020, bank transfers, prepaid cards and prepay are expected to gain market share while credit card usage is set to decline by 6 percent.
Through a combination of technological change, rising income levels and favorable demographics, South East Asia is set to be the next center of explosive e-commerce growth after China. According to Worldpay’s projections, China’s share of the world online retailing market will reach its peak in 2034, accounting for 50 percent of global spend.
“Although many alternative payment methods feel like merely niche options today, the data indicates we will see large growth in every market in the next five years,” said Casey Bullock, General Manager, North America, Global eCom at Worldpay. “As we continue to see huge differences in payment methods across the world and different markets adopting new technologies at different rates, the lesson to merchants is clear. A fragmented payments landscape demands a tailored strategy for each market. Offer a mix of payment methods that cater to the needs of consumers today and tomorrow.”
For more information from the Global Payments Report, and to download a copy, visit: http://www.worldpay.com/global/insight/articles/2016-07/global-payment-report.
About the 2016 Global Payments Report
The 2016 Global Payments Report was compiled using a combination of Worldpay’s data and insights, external findings from Euromonitor, Datamonitor and ystats.com, and secondary data from more than 100 independent sources. The forward-looking statements and figures contained in the report are indicative predictions based on Worldpay’s own data and experience and should be treated as such.
About Worldpay
Worldpay is a leading payments company with global reach. We provide an extensive range of technology-led payment products and services to over 400,000 customers, enabling their businesses to grow and prosper. We manage the increasing complexity of the payments landscape for our customers, allowing them to accept the widest range of payment types around the world. Using our network and technology, we are able to process payments from geographies covering 99% of global GDP, across 146 countries and 126 currencies. We help our customers to accept more than 300 different payment types, by providing an end-to-end service including acquiring, treasury, gateway, alternative payments and risk management, all via a single integration to Worldpay. Worldpay makes global payments simple for many of the world’s leading organizations.
For more information, visit www.worldpay.com/global.