Menu
ABA Banking Journal Home
Menu

Digital payments to nearly double by 2019

Distinct shift seen from physical to digital formats

Digital payments to nearly double by 2019

The annual transaction value of online, mobile, and contactless payments will reach $4.7 trillion by 2019, up from just over $2.5 trillion this year, says Juniper Research.

In a new report it observes that the largest net increase in spending would occur through remote physical goods purchases. It highlights the dramatic surge in activity in emerging markets such as China, with the online retailer Alibaba accounting for 20% of global B2C (business to consumer) and C2C (consumer to consumer) eretail worldwide in 2013.

However, Juniper says that while there was organic growth in the overall transaction levels due to increased purchasing on tablets and mobile, a significant proportion of tablet usage represented migration from desktop activity. It points out that combined transactions on mobile handsets and tablets would exceed those on desktops and laptops for the first time this year.

The report also notes that there was accelerating migration from physical format (DVD, CD) to digital (stream, download) across all core content sectors. These include a marked trend towards VOD (Video On Demand) from players such as Lovefilm and Netflix at the expense of DVD, with online VOD services in commercial deployment in most European markets.

Meanwhile, the report says that contactless activity will primarily be driven by card purchases rather than mobile, although it argues that mobile transactions should be boosted by HCE (Host Card Emulation)-based NFC (Near Field Communications) services.

According to report author Windsor Holden, “While we are now seeing contactless transactions scaling up in markets such as Australia, Poland, and the United Kingdom, almost all current consumer usage is via the card. However, with banks increasingly attracted to an NFC model in which they have full control of the customer, then we may well see some high-profile deployments in the medium term.”

John Ginovsky

John Ginovsky is a contributing editor of ABA Banking Journal and editor of the publication’s TechTopics e-newsletter. For more than two decades he’s written about the commercial banking industry, specializing in its technological side and how it relates to the actual business of banking. In addition to his weekly blogs—"Making Sense of It All"—he contributes fresh, original stories to each TechTopics issue based on personal interviews or exclusive contributed pieces. He previously was senior editor for Community Banker magazine (which merged into ABA Banking Journal) and was managing editor and staff reporter for ABA’s Bankers News. Email him at jginovsky@sbpub.com.

back to top

Sections

About Us

Connect With Us

Resources