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The payment gateways market size is estimated to grow at a CAGR of 11.72% between 2022 and 2027. The market size is forecast to increase by USD 8,551.26 million. The growth of the market depends on several factors, including the high adoption of contactless payment solutions, the growth in demand for PoS terminals from end-users, and the focus on high customer satisfaction.
This payment gateways market report extensively covers market segmentation by end-user (large enterprises, micro and small enterprises, and mid-sized enterprises), type (hosted and non-hosted), and geography (APAC, North America, Europe, South America, and Middle East and Africa). It also includes an in-depth analysis of drivers, trends, and challenges. Furthermore, the report includes historic market data from 2017 to 2021.
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The focus on high customer satisfaction is notably driving the market growth, although factors such as the safety of private consumer data may impede the growth. Our researchers analyzed the data with 2022 as the base year, along with the key drivers, trends, and challenges. A holistic analysis of drivers will help companies refine their marketing strategies to gain a competitive advantage.
The high adoption of contactless payment solutions is one of the key drivers supporting the payment gateways market growth. The introduction of mobile payment gateways, such as Apple Pay, Samsung Pay, and Android Pay, has simplified the process of paying bills. Customers are no longer required to carry credit or debit cards. Several retail outlets make use of POS terminals for payment of the purchases made by consumers. One of the main reasons for big players to offer the NFC-based mobile payment option is the security feature, which prevents the consumer and retailer from accessing the card information or security code illegitimately.
Users are initially required to save their financial data on their smartphones. They can conduct transactions by bringing the phone closer to the vendor's contactless payment-capable POS system. Once a connection has been established, users can approve the transaction by scanning their fingerprints or entering a password. Thus, the increased adoption of mobile devices and wearables has popularized the use of mobile payments. Such factors will increase the market growth during the forecast period.
The emergence of NFC-based payment technology is another factor supporting the payment gateway market growth. Many retailers, including Target, Macy's, and Walgreens, are using NFC-based contactless pay terminals. This technology helps in the transition to mobile payments. The devices that are integrated with these terminals can use Google Wallet. Owing to the rise in the demand for contactless payments, there has been a significant increase in the number of NFC-ready POS terminals. There are several vendors in the market that offer NFC-enabled POS terminals.
For instance, Verifone offers VX 520, a countertop POS terminal, which has integrated NFC capabilities to support alternative payments. Thus, the increase in the demand for cashless payments is expected to propel the growth of the global online payment gateway market during the forecast period.
One of the major challenges for the market is the safety of private consumer data. There are substantial risks associated with online transactions, such as identity theft and breaches in personal bank accounts. Customer data privacy is also a concern, as many e-tailing providers use this data to send notifications of changes and price updates. Many customers are against the use of their personal data, which is collected when they use the payment solution for marketing activities. Mobile service providers gather personal data to customize advertising messages and reach the target audience. They track cookies to gather information, which includes data on customer behavior, customer profiling, and data mining. The use of the data that is collected and stored by vendors is an infringement on customer privacy.
Moreover, location-based services also fall into the realm of privacy concerns, as geo-based information is required to provide such services to customers. E-commerce and m-commerce involve real-time monetary transactions through payment gateways. Therefore, financial data theft on such platforms can result in huge losses for consumers. Transactions through payment gateways still present security risks. The possibility of unauthorized access to such data discourages users from conducting transactions using payment gateways. This is a potential challenge that could impede the growth of the featured market during the forecast period.
The report includes the adoption lifecycle of the market, covering from the innovator’s stage to the laggard’s stage. It focuses on adoption rates in different regions based on penetration. Furthermore, the report also includes key purchase criteria and drivers of price sensitivity to help companies evaluate and develop their growth strategies.
Global Payment Gateways Market Customer Landscape
Vendors are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market.
Adyen NV: The company offers payment gateways such as Adyen digital payment solutions. Also, the company provides financial technology with products such as payment platforms and other financial products.
The report also includes detailed analyses of the competitive landscape of the market and information about 15 market vendors, including:
Qualitative and quantitative analysis of vendors has been conducted to help clients understand the wider business environment as well as the strengths and weaknesses of key market players. Data is qualitatively analyzed to categorize vendors as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize vendors as dominant, leading, strong, tentative, and weak.
The market share growth by the large enterprises segment will be significant during the forecast period. Most of the market revenue is generated by large enterprises as they are more inclined toward technologically advanced services such as payment gateways and mobile wallets. Hence, the growth in the demand and adoption of payment gateways is expected to drive the growth of the market in focus during the forecast period.
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The large enterprises segment was valued at USD 2,528.83 million in 2017 and continued to grow until 2021. Due to the large number of transactions generated, the acceptance of payment gateways among large businesses is very high. Firms operating in the BSFI, IT, and manufacturing sectors make the largest contributions to this segment. There are also some extensions of BFSI companies. Regional cross-border banking is also on the rise globally. This increases the need for payment gateways. This will increase payment gateway acceptance during the forecast period. Modern vending machines are equipped with contactless and card-based payments. This is a key factor driving the growth of the focus market.
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APAC is estimated to contribute 30% to the growth of the global market during the forecast period. Technavio’s analysts have elaborately explained the regional trends and drivers that shape the market during the forecast period. Demand for payment gateway solutions is driven by increasing urbanization and increasing disposable income of people in the region. Emerging markets such as India, Indonesia, Poland, and Hungary are seeing increased investment in infrastructure development, such as retail stores, restaurants, malls, hotels, and medical facilities. The construction of such projects is growing rapidly in these countries due to the availability of a large customer base of retail stores and shopping centers. This construction will increase the number of retail stores, restaurants, and payment processing locations, increasing demand for payment gateways in the region.
In 2020, the COVID-19 pandemic had a significant impact on the regional online payment gateway market. However, the market in focus was further backed up due to the containment of the pandemic owing to the conduction of large-scale vaccination drives in the region in 2021, further allowing the resumption of various economic and recreational activities in APAC, allowing the restoration of operations across malls, supermarkets, hypermarkets, and standalone outlets. As a result of these factors, demand and usage of PoS terminals are likely to rise across the retail sector of APAC, significantly boosting the growth of the regional market.
The payment gateways market report forecasts market growth by revenue at global, regional & country levels and provides an analysis of the latest trends and growth opportunities from 2017 to 2027.
Technavio categorizes the global payment gateway market as a part of the global systems software market within the global information technology (IT) software market. The parent, global IT software market covers companies engaged in developing and producing application and systems software. It also includes companies offering database management software. Our market research report has extensively covered external factors influencing the parent market growth during the forecast period.
Payment Gateways Market Scope |
|
Report Coverage |
Details |
Page number |
171 |
Base year |
2022 |
Historic period |
2017-2021 |
Forecast period |
2023-2027 |
Growth momentum & CAGR |
Accelerate at a CAGR of 11.72% |
Market growth 2023-2027 |
USD 8,551.26 million |
Market structure |
Fragmented |
YoY growth 2022-2023(%) |
10.86 |
Regional analysis |
APAC, North America, Europe, South America, and Middle East and Africa |
Performing market contribution |
APAC at 30% |
Key countries |
US, China, Japan, UK, and Germany |
Competitive landscape |
Leading vendors, market positioning of vendors, competitive strategies, and industry risks |
Key companies profiled |
Adyen NV, Amazon.com Inc., B2Broker Ltd., BitPay Inc., Block Inc., CCBill LLC, Fidelity National Information Services Inc., Global Payments Inc., Infibeam Avenues Ltd., Ingenico Group SA, JPMorgan Chase and Co., Mastercard Inc., MIH PayU BV, Payoneer Global Inc., Razorpay Software Pvt Ltd., Visa Inc., One97 Communications Ltd., PayPal Holdings Inc., Stripe Inc., and VeriFone Inc. |
Market dynamics |
Parent market analysis, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID-19 impact and recovery analysis and future consumer dynamics, Market condition analysis for forecast period. |
Customization purview |
If our report has not included the data that you are looking for, you can reach out to our analysts and get segments customized. |
We can help! Our analysts can customize this market research report to meet your requirements. Get in touch
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