Updated September 2024
$2.2 trillion of revenue was generated by the payment sector globally in 2022, 11% up on the previous year.
$3.2 trillion of revenue is expected to be generated by the payment sector by 2027.
36% of global banking revenue was generated from payments in 2022 (excluding capital markets and investment banking revenue) .
By 2027, payments are forecast to make up 38% of all banking revenue.
The revenue of the payment sector are forecast to have a 7% compound annual growth rate between 2022-2027.
47% of global payments revenues ($ 1 trillion) is generated in Asia Pacific and had the fastest annual growth rate of 25% if you exclude China which dropped 3%.
Merchants paid approximately $138 billion in processing fees in 2022 which vary significantly by region. In China, WeChat and Alipay collect only 0.1% and the EU has capped credit card fees at 0.3%. However, in the US, credit cards fees are unregulated and can go up as high as 3.5%.
In most regions, approximately half of the revenue growth in 2022 was the result of rising interest rates, rather than rising fees which was previously the main driver of growth.
Commercial payment products and services generate 53% of total payment revenue and this is likely to continue to grow.
However, in North America consumer payments still generate the majority of revenue (63%) where markets remain mostly card driven. For example, 37% ($150 billion) of North America’s payment revenue came from consumer credit cards compared to just 8% in EMEA.
Globally, margins are declining as indicated by the fact that payment volumes increased 17% but revenues only rose by 6% in 2022.
Global Payments revenues grew at 11% in 2022 to another all-time high of $2.2 trillion. North America, Latin America and EMEA all grew at double-digit rates.
Asia-Pacific was constrained by China’s 3% drop in revenues. If they are excluded, the payment revenues grew at a staggering 25% in 2022.
Global Payments revenues are forecast to have a compound annual growth rate of 7% from 2022-27 to reach $3.2 trillion in 2027.
Latin America is forecast to be the fastest growing region with a CAGR of 11% from 2022-27.
Revenue forecast of payment processing companies by region
The largest 10 merchant acquirers processed $9.5 trillion in card payments in the US in 2023 according to TSG’s 2024 directory of 300 companies which process 95% of all card payment volume in the US.
The top 3 processed 62% of the total volume but only worked with 22% of the merchants.
90% of the US card payment volume was processed by the top 25 merchant acquirers.
50% of the 14.8 million merchants used Stripe or Square but they accounted for just 5.1% of the transaction value.
Conversely, Ayden’s total processing value was higher than Square’s in 2023 but they have 185 times fewer merchants in the US.
The top 5 European acquirers account for 54% of payment volume and 40% of transactions (Worldpay, Nexi, Barclays, Adyen, Fiserv).
Barclays processed the highest transaction value in 2022 ($786.3 billion).
Worldpay moved to the number one acquirer in Europe in 2022 based on the number of transactions (11.2 billion)followed by Nexi (8.9 billion) and Worldpay (billion).
Nexi had the most merchant outlets, 1.98 million, and POS terminals, 2.92 million.
Adyen had the highest proportion of web-based transactions (76%) of the top 30 European merchant acquirers.
European credit, debit and prepaid transactions increased 18.7% from 2021 to 2022.
70% of e-commerce transactions were processed by digital wallets in Asia-Pacific in 2023. This compares to just 37% in North America.
12% of of e-commerce transactions were processed by credit card wallets in Asia-Pacific in 2023. That is half the global average and one-third the rate in North America.
Visa and Mastercard account for 90% of all payment processing outside of China and have a combined market value of approximately $850 billion.
9% of e-commerce transactions were processed by buy now, pay later (BNPL) in Europe in 2023, more than double the 4% rate in Asia-Pacific.
9% of e-commerce transactions were processed by cash on delivery in the Middle East and Africa in 2023, far higher than the global average of 2%.
Digital wallets are forecast to be used in 61% of digital transactions in 2028, up from 50% in 2023. That is a compound annual growth rate of 15%.
Digital wallets are forecast to process $3.1 trillion in 2027, which will be 4x more than credit cards.
Credit cards are forecast to be used in just 15% of digital transactions in 2028, down from 21% in 2023.
70% of e-commerce payments were made by digital wallets in Asia-Pacific in 2023, nearly twice the level of North America (37%).
The Payment gateway market (hosted and non-hosted) was estimated to be worth $127.1 in 2023.
It is predicted to generate revenues of $276.20 in 2030. That is a compound annual growth rate of 11% from 2023-2030.
North America accounted for 41.1% ($52.9 billion) of payment gateway revenues. Europe was second with 29.4% ($37.8 billion) and Asia-Pacific third with 19.7% ($25.42 billion)
The US accounted for approximately 30.4% of payment gateway revenues in 2023 ($38.6 Billion). This was nearly 4 times larger than Germany, the second largest.
The payment gateway market in Europe is forecast to have a compound annual growth rate (CAGR) of 11% between 2023-2030. That would more than double the market value from $37.8 billion in 2023 to $78.6 billion in 2030.
Germany is forecast to remain the largest payment gateway market in Europe in 2030 with the market increasing from $10.8 billion in 2023 to $12.2 billion in 2030. That would represent an impressive CAGR of 12.15%.
The payment gateway markets in France and the UK are forecast to double in size from 2023-2030 and each scale to over $15 billion in 2030.
Of all the countries the OECD analysed, Australia and New Zealand had the highest proportion of small businesses (10 – 250 employees) with websites taking payments for products and services online.
Within Europe, OECD analysis shows Ireland and Sweden have the highest proportion of small business websites that take payement for products and services online (47% and 45% respectively).
24% of small business websites (companies with 10-250 employees) in the EU as a whole take online payments.
The lowest ranked EU country was Luxembourg with just 19.4% of small business websites taking online payments.
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