That’s why checkout providers are focusing on optimizing the mobile payments experience, as well as exploring opportunities in social commerce. US retail ecommerce sales will exceed $1 trillion for the first time this year, although growth will be distributed unevenly across channels: desktop sales will decelerate through 2025, while mobile purchases boom, accounting for 4 in 10 retail ecommerce dollars for the first time this year. The demand for contactless is also giving rise to alternative and experiential methods, such as proximity payments such as Apple Pay, in-store buy now, pay later ( BNPL), and click and collect. According to our forecasts, debit spending will account for nearly 40% of in-store retail and food services dollars. In 2021, for the first time in 16 years, US debit spending surpassed credit as consumers aimed to limit financial risk during the pandemic-growth that’s meant to stabilize this year. From 2022 on, in-store’s share of retail sales will once again contract as customers gravitate toward ecommerce.Ĭard payments dominate in-store retail. In-store sales will remain the largest retail channel by both share and dollars as shopping habits normalize. Payments industry trends In-store payment methods Like what you’re reading? Click here to learn more about Insider Intelligence’s leading Financial Services research. In all corners of the payments industry, providers are racing to explore new transaction flows, reach new subsets of consumers and businesses, and embrace new devices and transaction technologies. This, in turn, is putting pressure onto point-of-sale (POS) providers to develop multichannel solutions that meet front- and back-end needs. In response to rapid digitization, merchants need to ensure customers can use their preferred payment method. In fact, cash and check’s share of in-store retail and food services transaction value will tick down to 18.5% this year and continue its downturn into 2023, per our forecast. Stakeholders that earn fees to help complete these payments-including acquirers and processors, networks, and issuers-are racing to keep up with changes in the way people and companies transact.Īnalog payments plunged at the pandemic’s onset, and will continue slowing down this year as debit, credit, and prepaid cards duel for their share of usage. The payment processing industry overviewĭigitization has been accelerated across peer-to-peer (P2P), business-to-consumer (B2C), and business-to-business (B2B) transactions beginning in 2020, but the second full year of the pandemic made it clear that they’re here to stay, even as spending levels normalize. With insights from our annual Payments Ecosystem report, we define and explore the payments industry, evaluating key trends affecting consumers and businesses. The pandemic accelerated payments industry digitization, with 2022 marking an inflection point in the way consumers and businesses cement the way they make their purchases. Do you work in the Financial Services industry? Get business insights on the latest tech innovations, market trends, and your competitors with data-driven research.Debit usage will be sustained as the most used payment method in the US, but faces competition from credit and prepaid cards with borrowing on the rise again.The pandemic-driven shift to digital isn’t dissipating, as cash and check’s share of in-store retail and food services transaction value will tick down to 18.5% this year.
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