Mobile Wallet Adoption

Within only a few years #contactless has conquered #payments. As we increasingly tap our cards, phones, and watches to pay for all kinds of goods and services, contactless payments have become the new norm. Let’s take a look. The statistics are telling: - More than half of all card payments in the euro area were contactless in the 2nd half of 2022 (source: ECB) - 91% of all card transactions were contactless in 2022 in the UK (source: Barclays) - Contactless payment transactions are estimated to reach $10 trillion in value globally by 2027 – a 117% increase vs 2022 (source: Juniper Research) A few reasons have triggered the rapid ascent of contactless: - The pandemic has driven increased demand and higher limits. - Digital payments’ #innovation has been on the rise across the globe with contactless being the primary beneficiary: digital wallets and SuperApps have incorporated contactless as their default option. Think of the huge ecosystems built on top of Apple Pay and Google Pay with contactless at their core. - #technology advances have made the use of contactless not only more convenient, but also much safer (i.e. biometrics for strong customer authentication, NFC etc). - Acceptance on the merchant side has become widespread: contactless is now standard for modern POS devices, whereas merchants can convert their phones and pads into contactless acceptance terminals. - Beyond a plethora of demand-side driven factors, the contactless economy is further boosted from a combination of supply-side developments: the rise of cloud-native tech architecture, the expansion of 5G, Internet-of-Things being all the more embedded in our daily lives as well as the use of #AI & data analytics. Depending on market maturity and on geographical specifics, the contactless evolutionary path has developed in various directions: for example, in emerging markets the contactless momentum has gone hand in hand with e-wallet adoption and the proliferation of QR-enabled solutions, whereas in more developed markets credit cards can serve as a growth driver to a larger extend. Irrespective of differing evolutionary models across the globe, there is no doubt that the frictionless future of payments is set to further drive the contactless adoption. In such an environment new use cases will be emerging as the integration of contactless payments in (new and existing) channels and rails continues. Opinions: my own, Graphic source: Mastercard & DSCI

The biggest myth in payments? That Gen X would never embrace digital wallets. We discovered a $357 billion opportunity that proves this wrong - and it all started with a boarding pass. While merchants were chasing Millennials and Gen Z, Gen X quietly mastered digital wallets through air travel. HUH?!?! How did that happen? It was because they offered Gen X something invaluable: efficiency without complexity (this generation flies all the time - and the wallet boarding made their life easier). Today, Gen X leads mobile boarding pass adoption at 45.7% - surpassing even digital-native Millennials. But it’s not just about boarding passes. The boarding pass proved to be Gen X's gateway to broader digital wallet adoption. The data is fascinating: - 45.4% of Gen X use digital boarding passes - leading all generations - 48.6% use digital wallets for event tickets - outpacing younger demographics Very surprisingly, their average transaction value is 2.3x higher than younger generations At Accrue, we've tracked this transformation across our merchant partners. Although 70% of new digital wallet users are younger consumers, Gen X consistently shows the highest transaction values and engagement rates. Which makes sense if you think about it: - Gen X has significant disposable income - Gen X knows how to use technology but likes simple, practical use cases - Gen X is in peak spending years for both personal and family purchases But here's what makes this a $357B opportunity: Most merchants continue focusing on younger demographics, creating a significant market inefficiency. Gen X isn't just adopting digital wallets - they're using them more frequently and for higher-value transactions than any other generation. And they’re underserved. That’s why Gen X represents a $350B+ opportunity right now. Because the window for capturing Gen X wallet share is still open. Even greenfield. This is why I believe the next wave of digital wallet growth will be driven by merchants building digital wallet strategies around Gen X, rather than chasing younger demographics. But time is running out. The window for capturing Gen X wallet share is narrowing. Only the merchants which build digital wallet strategies around Gen X spending patterns SOON will succeed in filling this market gap. It’s funny, when you think about it. Boarding passes, the gateway drug. Who would’ve thought? (pic - a slide we’ll be presenting in a couple weeks at the Merchant Advisory Group conference in Maryland. Join us... happy to hang) 

The European Mobile Payments landscape by Arkwright Consulting👇 Which players are missing in this overview? Let's dive in: Over the past two decades, the role and evolution of mobile payment systems in Europe has been the subject of ongoing debate and expanding activity. The adoption and integration of mobile payments has accelerated significantly in recent years, capturing the interest of individuals, businesses, and policymakers alike. Several factors have contributed to this surge in adoption: the proliferation of smartphones, an increased reliance on digital technology, and the impacts of the Covid-19 pandemic. Additionally, mobile interfaces have become critically important for banks and retailers. In this context, mobile payments facilitate daily customer interactions, potentially enhancing the customer experience (CX) and fostering loyalty. As a result, the mobile payments sector has become highly competitive, attracting a wide array of participants each vying to reach a critical mass or even establish a standard in certain markets or segments. This has led to a diverse market in Europe, characterized by a mix of domestic and international mobile payment options. In Arkwright's analysis (see picture below👇) they identified nearly 80 initiatives, which can be categorized into three main groups: 1️⃣ Major global wallets: Services such as Apple Pay, Google Wallet, WeChat Pay, and PayPal are present in most European markets, owing their success in outstanding CX and digital integration. Additionally, global branding, regulatory adaptability, and strong partnerships enabled market expansion and continued growth. 2️⃣ Domestic mobile payment systems: The domestic mobile payment landscape in Europe comprises over 45 distinct solutions (see Figure 1), each with its own regional footprint, functional set-up, and owners. Remarkably, several domestic solutions have experienced rapid expansion, with some reporting a user penetration exceeding 75 % in 2022, achieving near-universal presence in their respective market. In this segment, we can observe the first signs of an increasing maturity, including multi-country expansions and merger and acquisition (M&A) activities. 3️⃣ Region-wide European initiatives: Projects such as the EPI, the digital euro, and EMPSA aim to meet European political requirements by establishing viable competitors to international payment schemes on a European level. I highly recommend reading the complete #fintechreport for more interesting info on this topic: https://lnkd.in/exbrhFRS Find this helpful? [ 𝗿𝗲𝗽𝗼𝘀𝘁 ] Anything to add about this subject? [𝗶𝗻𝘃𝗶𝘁𝗲𝗱 𝘁𝗼 𝗰𝗼𝗺𝗺𝗲𝗻𝘁] Nice story, Marcel. Next! [ 𝗹𝗶𝗸𝗲 ] 

🟣 The latest FIS report on global payments is a rich yummy data and insights source – 180 pages!   Trends, changes, regional differences ❗️   In this post, I looked at how this year`s 𝐆𝐥𝐨𝐛𝐚𝐥 𝐏𝐚𝐲𝐦𝐞𝐧𝐭𝐬 𝐦𝐞𝐭𝐡𝐨𝐝𝐬 𝐅𝐈𝐒 𝐫𝐞𝐩𝐨𝐫𝐭 𝐬𝐭𝐚𝐭𝐬 compared with last year`s.   There are several `winners` and few `losers❗️   Credit card usage remains strong. Mobile wallet adoption holds its leading position online and gains more traction in-store, as predicted. Cash is clearly in decline but not too far from its medium-term floor (I believe). BNPL is stronger and so are Bank Transfers.  The FIS projections for Bank Transfer growth are very strong for several EM markets (Thailand, Brazil are leading). I was surprised by the levels of BNPL adoption in Germany of 23% compared to the average & US level of 5% and the Australian (a major BNPL market) of 14%.   In 2022   📍Online Mobile Wallet adoption @ 49% (same as 2021)   📍In-store Mobile Wallet adoption @ 32% (𝐚𝐧 𝐞𝐱𝐩𝐞𝐜𝐭𝐞𝐝 increase from 29% in 2021 and the FIS prediction from 2026 is even higher – 43%)   📍Online Credit card usage @ 20% (versus 21% in 2021)   📍In-store Credit card usage @ 26% (𝐚𝐧 𝐮𝐧𝐞𝐱𝐩𝐞𝐜𝐭𝐞𝐝 increase from 24% in 2021 and the FIS prediction from 2026 is 24% higher than last year`s 2025 prediction)   📍Online Debit card usage @12% (from 13% in 2021)   📍In-store Debit card usage @23% (unchanged from 2021 but the FIS prediction is 19% much lower than last year`s at 22%)   📍Bank Transfers @9% (𝐚𝐧 𝐮𝐧𝐞𝐱𝐩𝐞𝐜𝐭𝐞𝐝 increase from 7% in 2021, which is due to increased real time payments capabilities + the 2026 FIS prediction is 10% considerably higher than last year`s @6%)   📍BNPL @5% (an increase from 3% in 2021)   📍Cash @16% (a decrease from 18% in 2021 but the projections remain the same at 10%)   #payments #fintech #cards #wallets #cash #BNPL #POS #A2A

European mobile payments landscape Over the past two decades, the role and evolution of mobile payment systems in Europe has been the subject of ongoing debate and expanding activity. The adoption and integration of mobile payments has accelerated significantly in recent years, capturing the interest of individuals, businesses, and policymakers alike. Several factors have contributed to this surge in adoption: the proliferation of smartphones, an increased reliance on digital technology, and the impacts of the Covid-19 pandemic. Additionally, mobile interfaces have become critically important for banks and retailers. In this context, mobile payments facilitate daily customer interactions, potentially enhancing the customer experience (CX) and fostering loyalty. As a result, the mobile payments sector has become highly competitive, attracting a wide array of participants each vying to reach a critical mass or even establish a standard in certain markets or segments. This has led to a diverse market in Europe, characterized by a mix of domestic and international mobile payment options. In our analysis we identified nearly 80 initiatives, which can be categorized into three main groups: 1. Major global wallets: Services such as Apple Pay, Google Wallet, WeChat Pay, and PayPal are present in most European markets, owing their success in outstanding CX and digital integration. Additionally, global branding, regulatory adaptability, and strong partnerships enabled market expansion and continued growth. 2. Domestic mobile payment systems: The domestic mobile payment landscape in Europe comprises over 45 distinct solutions (see Figure 1), each with its own regional footprint, functional set-up, and owners. Remarkably, several domestic solutions have experienced rapid expansion, with some reporting a user penetration exceeding 75 % in 2022, achieving near-universal presence in their respective market. In this segment, we can observe the first signs of an increasing maturity, including multi-country expansions and merger and acquisition (M&A) activities. 3. Region-wide European initiatives: Projects such as the EPI, the digital euro, and EMPSA aim to meet European political requirements by establishing viable competitors to international payment schemes on a European level. Source Arkwright Consulting #fintech #payments #banking Arthur Leda Timothy Alex Ali Carlos Michael Andres

14 million Brits are swapping their wallets for phones. Is this the end of card payments in the UK? The data tells a surprising story: The UK is slowly shifting towards digital innovation. · Population: 68,971,000 (15th globally) · GDP Per Capita: $51,838 (16th globally) · 5th largest POS market ($1.6 trillion) · 3rd largest e-com market ($319 billion) Cards still dominate. · Debit cards: 46% of POS (point of sale) transactions · Credit cards: 28% · Prepaid cards: 2% But digital wallets are on the rise. · 14 million people using mobile payments · Projected to grow from 14% to 29% of POS transactions by 2027 In November 2023, HM Treasury launched the "Future of Payments Review." Its focus was to advance Open Banking and QR codes for A2A (account-to-account) payments, aiming to create a system like Brazil’s Pix or India’s UPI. Key trends we're seeing: · Digital wallet adoption is projected to more than double POS share from 14% in 2023 to 29% by 2027 · BNPL growth - especially for groceries · A2A payments struggling but with government backing · Cards holding strong but shifting into digital wallets The bottom line: The UK isn't rushing to go cashless. They're innovating, but cautiously. It shows that each market evolves differently. At Yuno, we’re helping businesses stay ahead, ensuring seamless adaptation to every country’s payment preferences. We believe companies should focus on what they do best—delivering great products and services—without worrying about payments.

Mobile wallets now dominate in-store debit transactions. 50.6% of all debit payments for two months running. 360 million mobile transactions versus 324 million card taps in July. But here's what the transaction count misses: mobile payments are consistently 20% smaller. $39 average for mobile wallets versus $46 for card taps. That gap hasn't shifted in 10 months of data. Translation? Mobile wallets own the quick transactions. Coffee, lunch, convenience stores where speed matters more than basket size. There is a demographic split as well as a location split. Younger users, smaller purchases, faster service locations. Mobile wallets capture 43% of debit dollar value despite winning 51% of transactions. Card taps still move more money overall. But, at current growth rates, mobile wallet value is projected to overtake card taps by January 2026. We are seeing a shift in multiple ways: 1. how different generations spend 2. changes in who still carries a wallet 3. preference for mobile over card based on the size of the transaction How do you spend? Everything on mobile, everything by tap? A mix? Or one of the declining number that still insert their card?