13th March, 2018
Extensive research conducted by RBR has shown that ever improving access to the internet via smartphone and tablets as well the general improvement in security (and perceptions of security), have led to ever increasing levels of online card transactions.
More people are finding online transactions to be far easier, and far more convenient as the increase of internet use, is allowing people to buy while on the go, as well as improvements in security and encryption. This all means people are more confident about storing their details using facilities like MasterPass.
The number of online transactions around the world is on schedule to leap from 29 billion recorded in 2016 to over 70 billion by the year 2022. This remarkable assessment has come from the highly respected Global Payment Cards Data and Forecasts to 2022, published in one of RBR’s yearly reports. The analysis has shown that the number of online card payments that have been made around the world in 2016 was up by 28% on 2015, and equates to about 9% of all payments made by cards. The RBR forecast then states that by 2022, 14% of all payments using a card will be online.
The primary force that is driving this transactional revolution is down to the number of ways people can access the internet, as well as improvements in security, the speed of internet connections improving, there being more choice online, and there being more ways to make a payment. More and more businesses are also learning that online is the way forward when it comes to both retail and business to business transactions. Most customers simply expect that a business will have an online presence, and they are more use to buying things from their phone while they are on the go, or take care of the weekly shopping, and have it delivered by the time they get home. The improvements in both logistics and payment methods online have gone hand in hand. Importantly, there’s far more trust in the security of online payments then there was in the past. The advent of 3-D Secure (e.g. Mastercard SecureCode and Verified by Visa) as well as a number of other measures means people a happier to shop online they may have been in the past.
As large as this market, and its growth may seem, there is still a huge amount of market share to be taken by online and electronic payments.
There are a number of factors that are slowing the growth of e-commerce card payments. In some parts of the world, there are issues with infrastructure, security concerns, and lack of uptake in new technologies. If they are resolved, it could make online card payments the dominant method of payment. The old cash-on-delivery method is still the standard for items that have been purchased online. This allows customers who don’t have access to online payment methods to still by online, and elevate any concerns people have about goods not being delivered, as well as allowing them to be inspected before payment.
Distinctive regional variations.
Almost one out of every ten of all card payments done in the world are made online, there is a substantial variation around the world, and even in different regions. In western Europe and the Asia Pacific region, 14% & 13% of all card transactions respectively are completed over the internet. In Eastern Europe, Africa, and the Middle East this number drops to as low as 3% to 4%. In some cases, this is because cash is king, and in some instances, it is as a result of poor infrastructure.
This is, however, expected to change has it has done in North America and Western Europe. Improvements in both infrastructure and education about the payment options available are improving all of the time. This all means that the future of online payments looks increasingly bright.
Overall, more business, and customers will turn to the internet for all of their needs, whether that’s paying for goods or paying for services, the key is to ensure that both the infrastructure, and the awareness improves to follow suit with the technology. test