COVID-19 highlights need for real-time digital payment services worldwide
COVID-19 highlights need for real-time new digital payment services worldwide, GlobalData research reveals
More than half a trillion real-time payment transactions will be processed over the next five years, according to Prime Time for Real-Time, a new global report from ACI Worldwide and GlobalData. The coronavirus outbreak has accelerated the use of cashless payments across the world due to consumers opting for contactless payments to avoid disease vectors, and a rise in online payments due to lockdowns. This will shape consumer behavior going forward, as consumers around the world will get into new habits of using digital payment services, which should boost the global Instant Payments (IP) market.
Sam Murrant, Lead Analyst in GlobalData’s Payments practice, and one of the report’s co-authors, predicts that the current crisis presents a major opportunity for real-time payments: “Real-time payments systems can really help with the disruption caused by COVID-19. The ability to send money to a contact and have them be able to use it right away presents a powerful tool for families and communities to support each other through the present hardship. In the longer term, once the user bases are in place, these systems will also be able to leverage their speed and efficiency to move out of P2P and into the consumer-to-business space.”
Centrally driven payments market initiatives are a significant factor for IP adoption, making it a strategic imperative for banks and companies in the market. The end goals will vary by country whether it is financial inclusion, cross-border commerce or shifting to a ‘cashless’ economy. These plans will likely be accelerated by consumers’ and businesses’ reluctance to use cash during the coronavirus pandemic.
Another is having a seamless and integrated payments experience with rich overlay service. This means that end users, whether it is consumers or businesses want convenience and growth is stronger where easy-to-use payments types exist in both markets.
Murrant continues: “The report forecasts a payment volume compound annual growth rate (CAGR) of 23.4% from 2019 to 2024 across the 30 global markets analyzed. India is poised to lead the world in real-time payments over the next five years, with transaction volumes set to grow from 15.3 billion in 2019 to 52.8 billion in 2024. India is already considered to be a world leader in IP, having launched its IMPS (Immediate Payment Service) in 2010 and since built on it with the highly successful overlay service UPI.
“Real-time payments have huge disruptive potential for payments – these systems won’t just be dominating P2P and bill payments in the years to come. We’ll be using these systems to pay online and ultimately at the point of sale too.”
Information based on GlobalData and ACI’s report COVID-19 Crisis Highlights Need for Real-Time and New Digital Payments Services Around the World
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