Last year, digital wallets surpassed debit card usage in the U.S., and digital wallets are set to overtake credit cards as the leading payment option within the next five years. Don't get left in the dust left by the digital boom. Check out these 20 insights from Worldpay's 2017 Global Payments Report to prepare your business for the future:
1.In 2016, credit cards were the most popular payment method around the world, with 29% saturation. However, by 2021, that will completely change, as an estimated 46% of consumers will use their eWallets to shop , instead of their credit or debit cards.
2. China is the largest eCommerce market in the world, and that's not going to change anytime soon. If you want to capture this market, look into accepting Alipay and WeChat pay on your website to attract Chinese shoppers.
3. If you're looking to expand your business's footprint in North America, look to Latin America. Argentina will have the fastest-growing eCommerce market in Latin America for the next 5 years, outpacing both Mexico and Brazil, thanks to their high internet penetration rate (80.1% of the population has internet access) and a large middle class population.
4. Passwords are so 2017. Biometrics will spell the end for passwords - not just for point of sale payments, but for customers who shop and pay on their mobile device or biometic-enabled laptop or desktop.Current methods include fingerprint scans, iris scans, heartbeat scans, voice recognition, facial recognition, palm vein scanning, and even ear prints.
5. Biometrics will go beyond the humble fingerprint scanner. While nearly all mobile wallets have allowed for payment authentication via fingerprint scan or PIN in the past, Apple’s recent debut of the iPhone X, with its 3D face-scanning detection technology, is set to lead a shift away from fingerprint scanning. Where Apple goes, the market usually follows.
6. India is the fastest-growing eCommerce market in the world. Demonetisation and a large population of unbanked consumers have contributed to the rise of eWallets, led by Snapdeal, MobiKwik, and Paytm.
7. Businesses that know how to leverage big data to tailor gather insights on how their customer demands and preferences change over time will be able to build a longer term relationship with their customers. For instance, Costco turns over its entire product suite 12 times a year to better serve its 75 million US subscribers.
8. Hong Kong is one of the leading digital economies with some of the highest rates of internet saturation in the world at almost 90%.
9. Baby boomers will be the cause of an eCommerce boom. By some estimates, global household spending by people aged over 60 in 2021 will be twice as much as seniors spent in 2010 - to the tune of $15 trillion. This is due to a large, tech-savvy aging population who are already comfortable using social networks and shopping .
10. Credit cards are the method of choice for shoppers in Japan. In the country with the world’s oldest population, low smartphone use among consumers age 65 and older is restricting mCommerce from growing quickly.
11. Aussies are increasingly opting for using their eWallets like PayPal and Visa Checkout over credit cards. BPAY is a popular electronic bill payment system in Australia that is quickly dominating other bill payment services. Another thing Aussies are into: international shipping. Nearly 20% of Australian eCommerce was cross-border in 2016.
12. While digital wallets will remain the global payment method of choice for eCommerce, bank transfers will also surpass both credit and debit cards in popularity, becoming the second most popular payment method in the world. This is good news for merchants, since there is generally a lower cost of payment acceptance for bank transfers than for payment cards.
13. In Malaysia, eCommerce growth is expected to outpace traditional in-store sales over the next 5 years. 75% of Malaysian internet users browse the web via smartphone.
14. Last year Singapore overtook Silicon Valley as the Number 1 source for start-ups, so it’s no wonder that 73% of internet users in this high tech city shop .
15. The US has the oldest eCommerce market in the world. And US shoppers are pretty traditional, with 75% of transactions in the US paid via Visa or Mastercard.
16. In the Netherlands, iDEAL is the most widely used payment method , with 1 out of every 5 purchases made on a smartphone.
17. Subscription services will grow in popularity, due to consumers who are happy to pay for convenience. Right now, 92% of millennials and 70% of retirees in the US have active subscriptions. Look for the subscription model to make an impact beyond content subscriptions, to luxury goods to sports equipment, and even cars.
18. The top 3 digital payment services for Russian shoppers are Yandex.Money, Webmoney, and Qiwi. Nearly 50% of shoppers in Russia make at least one purchase a month.
19. Consumers in New Zealand are all about platforms with Alibaba and Amazon both having significant presence.
20. South Korea's advanced IT infrastructure means that nearly all households are connected to the internet and most adults have a smartphone. South Korea is one of the largest eCommerce markets in Asia, and is expected to see double digit eCommerce growth in the next 5 years.