The global rise of eCommerce is forecasted to surpass $4.6 trillion in spending by 2020. This massive growth has led to over 140 different electronic payment options being used worldwide. In addition to the rise of eCommerce, digital payment options are forecasted to comprise 47% of the payments used for eCommerce. This is due to massive growth in the usage of eWallet’s as newer technology is developed.
eWallets provide the customer with both greater convenience and security when compared to other payment methods. Also, eWallets are often merged with mobile devices which are taking a dominant position regarding website traffic and eCommerce spending devices. Furthermore, eWallets are anticipated to receive 28% of POS transaction. This is due to developments in infrastructure. These developments aid the usage of electronic payment options in stores and push towards a reduction in cash sales.
On a global scale, an overall shift is evident towards digital payment, but this varies significantly depending on the region and country. Asia shows a strong adoption rate of digital options with eWallets taking strong positions in countries such as China. In contrast, cash still holds a large market share for transactions in Latin American countries.
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The use of credit cards dominates North America as they currently take the largest share for payment options in both eCommerce and POS spending at 34% and 41% respectively. However, when reviewing forecasts for 2022, eWallets will take up 1/3 of eCommerce payments with usage in POS stores forecasted to climb from 4% to 7%. In person, sales are expected to remain dominated by debit and credit cards with them accounting for 76% of the payment options used in these transactions.
Latin America is quite diverse concerning eCommerce payment options. Credit cards currently hold the largest market share at 45% for 2018 with eWallets at 15% of the market share taking the second spot. Forecasts for 2022 project a more diverse online payment climate with eWallets, debit, and PostPay expecting to grow significantly.
Cash currently dominates POS transactions in Latin America with cash projected to be used in 58% of in-store purchased. Looking forward, by 2022 cash is still expected to hold a strong position at 36% with credit, debit, and eWallets forecasted to grow in market share. The significant predicted growth in digital payment options is primarily due to improvements in infrastructure in Latin American countries which, will allow for more diversity in payment options.
European payments display a significant contrast to other regions as each country has different trends and market share for both eCommerce and POS payment options.
The eCommerce landscape for digital payment options is currently dominated by eWallets, debit, and credit cards which them holding 21%, 20%, and 20% respectively. Forecasts for 2022 show a decrease for debit and credit cards and marginal growth for eWallets to 24% of the market share. Also, bank transfers are suspected to have a fare increase from 16% in 2018 to 20% by 2022.
Cash currently hosts a strong position composing of 47% of the POS payments in 2018. This number is expected to decrease to 30% by 2022. This decrease is due to the emergence of digital payment options in stores with debit card usage expected to increase from 36% to 44% by 2022. Also, eWallets, are expected to make a significant increase from 3% to 8% of POS sales by 2022.
Asia is the most innovative continent concerning using electronic payment methods for both eCommerce and POS spending. eCommerce spending is dominated by eWallets with 52% for 2018 and is forecasted to grow to 66% of the market share by 2022. In contrast to eWallets, other payment options are expected to decrease in market share by 2022 as eWallets come to prominence.
Point of sales spending is divided by cash, eWallets, debit and credit cards. Cash currently holds the large share of the market, but this is expected to decrease by over 50% by 2022. This is in line with eWallets forecasted growth from 27% to 42% by 2022. The expansion in digital payment options in Asia is mostly tied to the extreme amount of infrastructure growth in the continent leading to more diversity in available payment options.
Overall, the global payment landscape in the future will continue to shift towards digital payment options. This is due to the continued rise of e-commerce shopping which is rapidly outgrowing brick-and-mortar sales. In addition to this, global infrastructure growth has allowed for more diversity in payment options to be used in stores.