A recent study by Worldpay indicates a significant surge in the use of digital wallets, marking a transformative shift in the landscape of global payments.
The report, titled the Global Payments Report 2024, highlights the growing preference for digital wallets among consumers, attributing it to factors such as ease of use, accessibility, and enhanced security measures.
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Continued growth projected
According to the report, digital wallets accounted for a staggering $13.9tn in global transaction value in 2023, representing half of all online transactions and 30% of consumer spend at point-of-sale (POS).
The findings suggest that this trend is set to continue, with digital wallets projected to surpass $25tn in global transaction value by 2027, constituting 49% of all sales online and at POS combined.
Factors driving adoption
The research identifies several factors contributing to the rapid adoption of digital wallets.
The convenience offered by these platforms, coupled with increased consumer trust arising from enhanced security measures, has propelled their widespread acceptance.
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By GlobalDataMoreover, the report notes that the Covid-19 pandemic served as a catalyst for the accelerated adoption of digital wallets, pushing them into the mainstream as consumers sought contactless payment options.
Regional variances in payment preferences
While digital wallets have gained traction globally, the report highlights regional variations in payment preferences.
In markets where credit and debit cards have strong consumer attachment such as the US, consumers tend to connect these cards to their digital wallets.
Conversely, in regions such as Brazil and India, where cash-dominated economies are undergoing a shift towards digital payments, instant-payment services such as Brazil’s Pix are gaining popularity for their convenience and reliability.
The increasing visibility of alternative payment methods
Gabriel de Montessus, head of Global Enterprise at Worldpay, emphasised the significance of understanding consumer preferences in driving payment innovation.
He underscored the role of digital wallets in streamlining payment experiences, both online and in-store, and urged stakeholders across the payments ecosystem to collaborate in offering greater payment freedom to consumers and merchants.
The report also highlights the growing prominence of alternative payment methods, such as account-to-account (A2A) transactions, particularly in regions where governments have invested in developing the necessary infrastructure.
In countries like Brazil, India, and the Netherlands, A2A payments are projected to play a significant role in shaping the future of e-commerce transactions, underscoring the evolving dynamics of the global payments landscape.
