Alternative Payments to Rise 13% by 2015
WorldPay, a payment processing, risk and alternative payments company, has released ‘Optimising Your Alternative Payments’, a whitepaper and interactive heatmap of the alternative payments landscape and the varying cultural preferences of payment types by geography.
The alternative payments (AP) market is growing at a phenomenal rate. Today, it accounts for €165bn of global e-commerce transactions around the world, which is 22% of the total transactional value. It is estimated that there are currently over 230 AP schemes operating globally including: real-time bank transfer, offline credit transfer, direct debits, e-wallets, paper-based payments and mobile payments (m-payments).
The AP market is expected to grow 13% by 2015, and within e-commerce, spend via alternative payments will outstrip that of card payment schemes. Growth rates of payment types vary, for example, e-wallets currently lead the way with 36% of the market and this is expected to rise to 43%. Real-time bank transfers only make-up 12% of the AP types today but this figure is expected to rise to 20% in the next three years.
In the UK and US, card payments dominate (11% and17% respectively). It is only due to the scale of the e-commerce market in the US, that AP transactions comprise €46.6bn of online spend. In other regions, APs have a stronger share of the payments market.
Key regional findings from the whitepaper include:
Phil McGriskin, chief product officer (CPO), WorldPay, said: “Cultural payment preferences have always existed but until fairly recently, online purchasing options were dominated by global card schemes. With the advances in technology, a new generation of shoppers and developing online economies, alternative payments are growing in popularity. This presents an opportunity in the e-commerce space for merchants to gain a competitive advantage by offering customers the option to pay using their preferred payment type. Merchants need to identify where their target customers are located and offer the relevant payment options to cater to cultural preferences. This will ultimately drive revenue for merchants, especially in new and developing economies.”