A new study from Juniper Research has found that mCommerce payments will reach $3.1 trillion in 2025, from $2.1 trillion in 2020. The research found that the pandemic’s massive boost to digital wallet services in the offline arena with OEM Pay has been a key driver of greater mCommerce usage, accelerating the already rapid transition from offline to online services.
‘Buy Now, Pay Later’ payments rapidly gaining traction
Juniper Research anticipates that this uptick in mCommerce will translate into rapid growth of new payment models, such as BNPL (Buy Now, Pay Later). Deploying BNPL via APIs in checkout processes will mean a significant shift away from traditional fee- and APR-based credit card models of consumer financing for online purchases, particularly amongst millennials less convinced of the benefits of credit card ownership. BNPL also offers significant advantages to merchants as a way to increase average basket size, whilst boosting the user experience for shoppers.
Research author Susannah Hampton added: ‘It is critical for payment processors to prioritize building technological ecosystems to allow the acceptance of BNPL across all payment methods, or they will be left behind by more digitally-adept providers.’
China and the US: Key Growth Markets
The new research, eCommerce Payments: Emerging Trends, Opportunities & Market Forecasts 2020-2025, found that the two single largest eCommerce markets, China and the US, will see volume growth in smartphone payments for remote goods of 55% and 74% respectively, between 2020 and 2025.
In China, eWallet payments are well established, with eCommerce continuing to grow, as availability and prosperity rise. In the US, OEM Pay wallets and PayPal will be the major beneficiaries of a permanent pandemic-driven shift to online shopping. The research recommends that payment processors prioritize wallet acceptance for the most popular wallets in target countries at both the online and offline point of sale, or risk missing out on this huge opportunity.
For more insights, download the free whitepaper: Alternative Payments and the Evolving eCommerce Landscape