Digital payment is a form of transaction which takes place with the help of digital or online modes, with no physical exchange of money comprised. This means that both the parties, the payee and the payer, utilize the electronic mediums to exchange the money.
In other words, the payment services are an underpinning of every region. With digitization and sustained technological development, they can progressively offer consumers and businesses manners of paying that are tailored, convenient and flexible. Digital payments can also assistance financial inclusion, facilitate budgeting, and enable action to safeguard and tackle economic crime. The government recognizes that the growth in the usage of digital payments has been swift, and it wants to confirm that everyone has the option to be capable to pay for goods and services digitally. That is why the government has undertaken a proficient program of work that, by assisting the innovation and competition, has already supported make digital payments simpler, faster, and cheaper.
According to the report analysis, ‘Global Digital Payment Market: Current Analysis and Forecast (2020-2026)’ states that developed economies have adopted a cashless payment infrastructure based commonly on credit cards countless decades ago, but during recent years, the legacy structures have suddenly become a burden. The “Western” markets are now much sluggish to adopt fresh payment solutions than increasing economies such as China, India, or Eastern Europe. A large share of the populace in the underdeveloped economies of Asia, Africa, and Latin America has also been underbanked until the augment of mobile payment and wallet innovations that completely rely on reachable mobile technology.
Both solution and services are indispensable to smoothly carry out digital payment. Countless digital payment solutions are prevailing in the market such as POS, e-commerce, e-wallets and net banking amongst others. Based on mode of payment, the market is generally bifurcated into Mobile POS payments and digital commerce. The mode of payment is generally divided into on-premises and cloud. Large enterprises have majorly implemented these solutions. However, transforming the regulations and behaviour of consumers has motivated SMEs to adopt them.
Based on the end-user, the market is sectored into BSFI, healthcare, IT & Telecom, Media and Entertainment, Retail and E-commerce and several others. All the segments are deploying such solution and services as they make payment more opportune and safer. During the recent trend, individual prefer online shopping as it is speedy and easy. Moreover, the lockdown in the COVID-19 times have motivated contactless shopping and payment to circumvent the contact with infected individuals.
The market is predicted to benefit from the high implementation rate of smartphones, rise in e-commerce sales, and advanced internet penetration around the globe. Governments around the globe are undertaking initiatives to digitize payments. This is encouraging the economic growth and is benefitting end-users in several countries across the globe. Moreover, the proficient growth in e-commerce sales around the globe is also one of the foremost factors propelling the market growth during recent days. Nowadays, people around the world are increasingly utilizing the contactless cards and mobile payment solutions for making the online payments.
Furthermore, the digital payments market is projected to grow, due to the worldwide initiatives for the encouragement of digital payments, proliferation of smartphones enabling mCommerce growth, augment in eCommerce sales, and growth in internet penetration.
Although, the outbreak of COVID-19 has proficiently impacted functions in a few key sectors, such as manufacturing, logistics, hospitality, transportation, healthcare, and retail, and temperately impacted a few segments that comprise IT and telecom, energy and utilities, government, education, and BFSI. The pandemic has augmented the adoption of contactless and wallet payments. eWallets are observing augmented the traction for Peer to Peer (P2P) transfers, bill payments, and Customer to Business (C2B) payments for essential services due to the lockdown and aversion to the exchange of cash. However, some wallet providers have augmented their fees for merchants and consumers, leading to wholesalers not accepting their wallets for the transactions.
Whereas, the Digital payment platforms are a foremost market growth imperative and can support boost economy, productivity, transparency, and comfort of access to financial services. Further, favourable government regulations such as those around India and Japan continue to boost the digital payments market forward. The move towards contactless payment services was already quite predominant across the globe but has been all the more fostered by the COVID-19 pandemic.
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Ankur Gupta, Head Marketing & Communications