The global Payment Processing Solutions Market was valued at USD 52,124.4 million in 2019 and is estimated to reach USD XX million by 2027, with a CAGR of 8.46% during the forecast period (2020-2027).
Payment processing refers to automated operations between the customer and the merchant. A third-party service, usually a computer-based system such as eMerchant Gateway, processes the customer's payment information and is set up to accept or decline payments on behalf of the merchant oriented on pre-set parameters. A merchant account is a business and financial arrangement with a credit card processor that enables a dealer to accept payment cards online.
The payment processing solutions market is growing owing to several factors such as, increasing initiatives for the promotion of digital and online payments, growing focus on improving customer experience, and rising customer demand for immediacy of payments and settlements. Increasing cyber attacks on the existing payment processing solution coupled with lack of awareness among the communities over digital transactions is the primary factor hindering the growth of payment processing solutions market globally during forecast period. Increasing credit card ownership rate across the globe coupled with increased acceptance rate of credit card based payments across the globe is the primary factor driving the credit card segment in the global payment processing market during the forecast period. The Asia Pacific market for payment processing solutions is expected to grow at a higher pace during forecast period owing to growing adoption of e-wallet and mobile payments by the communities located across the highly populated countries such as India and China associated with increasing government policies to boost the digital money and digital transactions.
The leading companies are focusing on strategic partnership and mergers & acquisitions to gain a competitive edge and increase market share. On November 18th 2019, International maritime payment solutions provider, ShipMoney launched a new initiative: ShipMoney Cares. ShipMoney Cares will be managed by ISWAN and is designed to provide one-time financial grants to seafarers in need, which could include medical or educational support. ShipMoney along with its strategic remittance partners will make a sizable annual donation to the program. There is a maximum grant of $500 and seafarers can apply once a year. In June 2019, ShipMoney extended its maritime payment services agreement with the UK-based shipping company Helikon Shipping Enterprises Limited into a long-term multi-year relationship.
Market Dynamics
Drivers
- Increasing initiatives for the promotion of digital and online payments
- Rising customer demand for immediacy of payments and settlements
Restraints
- Lack of global standard for international transaction
Opportunities for Market Growth
- Low Level Automation
- Increasing Internet Penetration Rate
- Increasing digital money adoption rate North African countries
Low Level Automation
Presence of low level of automation in pay rolls in various industries and utility service providers. Shifting government regulations to boot digital money is expected to provide a huge market opportunity for payment processing solutions globally.
Increasing Internet Penetration Rate
Increasing internet penetration rate smartphones globally coupled with increasing consumer interests towards digital payments is expected to boost huge opportunities for payment processing solutions globally during the forecast period.
Increasing digital money adoption rate North African countries
Increasing digital money adoption rate in major developing nations in North African countries is expected to provide huge market opportunity for payment processing solutions across the Middle-East and African region during forecast period
Geographical Analysis
The North America market for payment processing solutions was valued at USD 10,616.2 million in 2019 and the market is estimated to grow at a CAGR of 7.35% during the forecast period to reach a market value of USD XX million by 2027. North America comprises developed countries, such as the US and Canada. These countries have invested significantly in Research and Development (R&D) activities, thereby contributing to the development of innovative technologies. The payment processing solutions market in North America is highly competitive, as countries such as the US and Canada are focused on R&D and innovation. These countries are early adopters of technologies in various verticals. The US and Canada are also the leading countries in retail, financial services, banking, and other industries, such as transportation and manufacturing. Credit card is the most preferred mode of payment by consumers in both online and point-of-sale (POS) method in North American countries. Presence of a wide group of communities both in industrial and retail sectors adopting advanced payment processing solutions to eradicate the service costs associated with other manual techniques is the primary factor driving the North America payment processing solutions market. Various factors led to increased adoption of payment processing solutions in major developed countries in North America including minimal human interaction, low transaction time and cost-effective nature over currently available alternative technologies. Increasing online fraud and decreasing consumer interests towards debit & credit transactions is expected to boost huge demand for e-wallet transactions and e-wallet based payment processing technologies in North America during forecast period
According to the study published in Global Payments Report, the annual e-wallet transactions in the United States in total online payment transactions is expected to increase from 20% in 2018 to 305% in 2020. The major payment processing technologies used by the communities and industrial end-users located across the United States includes GoURL, Cayan Payment Gateway, Klarna, Stripe, Chase Paymentech, Amazon Pay, Paypal Payment gateway, Bue Pay are among many others. These payment gateways or payment processing solutions are extensively used in department stores, discount stores, gas stations, supermarkets, dine-in restaurants, fast-food restaurants, and coffee shops.
The key players in the North America payment processing solutions market are focusing on improving their market presence in their respective business segments through collaborations and agreements with major food and beverages and drugs chains located across the region. In August 2019, Bank of America Merchant Services, one of the major leaders in payments, eCommerce, and security solutions made an agreement with RiteAid for the deployments of payment processor and security solutions across its 2,400 durg stores located across the United States.