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The global payment processing solutions market was valued at USD 70 billion in 2023 and grew at a CAGR of 12% from 2024 to 2033. The market is expected to reach USD 217.40 billion by 2033. The growth of digital transactions and fintech will drive the growth of the global payment processing solutions market.
Payment processing solutions can be defined as processes or services by which the overall exchange of funds between consumers and firms can be both completed and coordinated. These solutions make sure that payments are authorised, executed and cleared as efficiently as possible. They are at the centre of today’s commercial landscape. At their core, payment processing solutions involve a sequence of steps. These three Phases are known as authorization, authentication, and settlement. In the authorization stage, the payment processor verifies customer’s payment credentials like a credit card number, account number etc. Authentication protects the transaction through means such as encryption, tokenization, multi-factor authentication. Lastly, settlement takes place thus moving the funds from the customers bank to that of the merchants. There are payment gateways to ensure that they provide these solutions as they act as intermediaries.
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The increasing number of digital transactions – The expanded usage of internet and operational technologies have extensive effects in changing the nature of shopping experience and business throughout the world. In the last decade, technological improvement coupled with enhanced access to the internet and improved smart phone use contributes to the growth of the m-commerce and digital services. E-commerce capabilities including mobile app, shopping assistant provided by Artificial Intelligence, and virtual reality showrooms have improved the overall experiences of e-commerce. These developments have all contributed to the increasing necessity of secure payment processing systems. Platforms need robust, high-throughput payment systems, supporting multiple currencies, and a range of features that can be extended to users such for efficient, safe and secure transactions.
High costs and integration challenges – SMEs find payment processing solutions expensive due to the various charges imposed including the setup fees, transaction charges and subscription fees. These systems usually need further investment in technology development, staff training, and system maintenance making them relatively costly and less reachable to small and medium organizations. Adding to these cost concerns is the fact that majority of consumers are still reluctant to move from the normal tradition of using cash, especially in developing nations where these are considered to be the order of the day. For this reason, trust in digital payment systems remains relatively low where consumers reside in rural areas or where available technology is not highly developed due to the perceived high risk of falling victim to fraudsters, and data and system failures. This hesitance undermines the potential for widespread adoption of payment processing solutions, shrinking the customer base for potential business applicators. The problem is compounded by the fact that the integration of various payment platforms on various outlets is not standardized which further impedes the market’s growth.
Expanding fintech industry – Mobile phone ownership has increased tremendously all over the world offering billions of consumers first-hand access to digital financial services. Low-cost gadgets, accompanied by better internet connection helps people in the bottom of the pyramid to enter electronic commerce. This has improved the demand for the use of mobile payments. At the same time the capabilities of payment processing solutions have grown with the development of FinTech. Technological advances such as blockchain for secure and decentralized transactions and open banking APIs, fraud detection through Artificial Intelligence and Machine Learning have enhanced the working of these systems. Some of the other conveniences introduced by such platforms include real-time settlement, cross-border payment processing, and consumer financial management processing have provided value addition features and increased usage of payment processing solutions by business and consumers. The enhancement of FinTech solutions together with the spread of smartphones results in an effectively developing environment for payment processing solutions market’s growth during the forecast period.
The regions analyzed for the market include North America, Europe, South America, Asia Pacific, the Middle East, and Africa. North America emerged as the most significant global payment processing solutions market, with a 38% market revenue share in 2023.
The region has been amongst the first to incorporate new payment technologies including contactless cards, mobile wallet, and immediate payment systems. The leading role of North America is explained by strong financial infrastructure that enabled smooth interoperability of popular payment tools such as credit and debit cards as well as mobile payments. High demand for broad network coverage, resulting from high smartphone ownership among the population of North America, make consumers eager to adopt various digital payment solutions and push for the improvement in payment processing systems.
North America Region Payment Processing Solutions Market Share in 2023 - 38%
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The payment method type segment is divided into card payments, mobile payments, bank transfers and cryptocurrency payments. The card payments segment dominated the market, with a market share of around 36% in 2023. Credit and debit cards are the largest segment of payment processing market because they are widely accepted, popular and trusted by customers and businesses. While credit cards are well-liked for the convenience of post-purchase-instalment payment option, debit cards are much more preferred for the benefit of direct access to the bank accounts free from debt risk. Such flexibility guarantees their leadership in various kinds of transactions and sectors, like merchant services, travel, healthcare and Internet commerce.
The end user industry segment is divided into retail, hospitality, financial services, healthcare and others. The retail segment dominated the market, with a market share of around 35% in 2023. Of all industries, the retail industry contributes to the largest market share of payment processing solutions because this industry needs ways and means to deal with both, the physical point of sale and online sales. Most retail shops including small enterprises and multinationals need efficient and effective methods of payment processing for handling massive transactions in customer’s purchases. As the e-commerce business grows, retailers rely on effective and secure payment systems to accept orders from website and mobile applications. The market dominance of payment processing by retail is supplemented by consumers’ tendency towards plastic and digital payments. The opportunities to make payments without leaving home, the speed of online payment, and the security of payment instruments have influenced both, the retailers, and the consumers in favour of these payment solutions.
The deployment model segment is divided into cloud-based solutions and on-premise solutions. The cloud-based solutions segment dominated the market, with a market share of around 74% in 2023. In the payment processing market, a cloud deployment model has become the most popular one indicating its significant advantages in terms of scalability, affordability, and versatility. Cloud-based payment processing solutions are centrally located on servers that are physically accessible over the internet and this eliminates the need for businesses to invest greatly on establishing infrastructures for the payment processing systems, and the companies have the advantage of expanding or contracting depending on the requirements. This makes cloud-based systems especially suitable for everyone from small and medium-sized enterprises to the large firms. Other advantages include increased flexibility. This is particularly important when the firm carries out its operations in different areas or in a different country. Also, cloud systems are more flexible in integrating new technologies and meeting the regulations obligatory for them. Moreover, the cloud payment processing solutions present additional features like encryption, tokenization, and constant transaction fraud detection that assist companies in addressing new emerging threats. They also support the integration with various payment types like mobile payment solutions, credit card, digital currency etc.
| Attribute | Description |
|---|---|
| Market Size | Revenue (USD Billion) |
| Market size value in 2023 | USD 70 Billion |
| Market size value in 2033 | USD 217.40 Billion |
| CAGR (2024 to 2033) | 12% |
| Historical data | 2020-2022 |
| Base Year | 2023 |
| Forecast | 2024-2033 |
| Region | The regions analyzed for the market are Asia Pacific, Europe, South America, North America, and Middle East and Africa. Furthermore, the regions are further analyzed at the country level. |
| Segments | Payment Method Type, End User Industry and Deployment Model |
As per The Brainy Insights, the size of the global payment processing solutions market was valued at USD 70 billion in 2023 to USD 217.40 billion by 2033.
Global payment processing solutions market is growing at a CAGR of 12% during the forecast period 2024-2033.
The market's growth will be influenced by the increasing number of digital transactions.
High costs and integration challenges could hamper the market growth.
This study forecasts revenue at global, regional, and country levels from 2020 to 2033. The Brainy Insights has segmented the global payment processing solutions market based on below mentioned segments:
Global Payment Processing Solutions Market by Payment Method Type:
Global Payment Processing Solutions Market by End User Industry:
Global Payment Processing Solutions Market by Deployment Model:
Global Payment Processing Solutions Market by Region:
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