by Priya Deshmukh
According to Global Market Insights, Inc. report, mobile wallet market size is projected to surpass USD 350 billion by 2026. With the massive advancements and rising prominence of efforts undertaken by major multinational tech giants in the field of fintech sector, global mobile wallet market is set to gain massive momentum over the foreseeable future. Additionally, shifting consumer inclination towards digital payment solutions are encouraging the tech players to develop more innovative mobile wallet solutions which is likely to open new growth avenues for the industry.
Furthermore, increased adoption of smartphones, tablets and other smart devices for using bank services has promoted the adoption of mobile wallet solutions to great extent. Apparently, mobile banking is impending its saturation point across developed economies with significant penetration level of over 83%. Also, favorable government initiatives and policies are influencing the volume of mobile wallet transaction.
Below mentioned trends:
Growing adoption of semi-closed mobile wallets
Semi-closed segment held a significant market share of over 60% in the past and is expected to grow immensely over the upcoming years. The growth can be credited to the influx of numerous technology companies in the fintech sector and a paradigm shift of customers toward e-wallet payments. In addition, around one third of the millennials believe that they will have a bank-free future which is likely to be driven predominantly by mobile wallet technologies.
Increasing popularity of bank-owned mobile wallets
Bank-owned mobile wallet segment is estimated to register an appreciable CAGR of 14% through 2026 on account of growing preference towards mobile wallet solutions among banks and other financial institutions for enhancing their customer retention, customer relationship and placing their payment cards as top wallets. Besides, the ongoing transformations in financial landscape of banking sector has evoked several major banks to incorporate various mobile wallets to optimize their customer experience.
Burgeoning demand for digital only mobile wallets across retail sector
Digital only mobile wallets are gaining a massive traction over the past few years and are likely to amass huge demand over the forthcoming years. This can be attributed to extensive adoption by the retail segment. The increased inclination towards mobile wallets has urged companies to invest in the development of digital only mobile wallets to enable transactions from remote locations. Moreover, technological advancements such as integration of biometric technology in digital only mobile wallets will support the product adoption further.
Strong presence of prominent mobile wallet companies across Europe
Europe mobile wallets market is expected to observe a robust growth rate of 15% through 2026 owing to the presence of numerous mobile wallets providers across the region. Apparently, in 2019, over 50 mobile wallets were operational in the region, out of which 26 were regulated by banks and most of these wallets were initiated through the collaborative efforts of banks and technology companies. In addition, non-banking institutions introduced around 23 mobile wallets.
Strategic initiatives by prominent players
Eminent players operating in mobile wallet market such as Google LLC, Apple Inc., PayPal Holdings, Inc., Mastercard Inc., etc. are inclined on developing new technologies along with mergers and acquisitions to gain a strong position in the market. For instance, in 2019, Google LLC introduced facial recognition and fingerprint scan features in its Google Pay wallet. According to the company, these features offer more secured mobile wallet transactions as the biometrics and password/PIN run in conjunction.
Citing another instance, in 2020, PayPal and UnionPay International (UPI) entered into a global partnership to jointly work towards enhancing the growth of their networks. Apparently, through this agreement, PayPal is intending to support the acceptance of UPI globally wherever PayPal is accepted which in turn will offer UnionPay cardholders more choice during shopping. On the other hand, UPI is aiming to explore opportunities for supporting PayPal’s merchant and consumer ambitions in China. SW
A link to the report can be found here.
Priya Deshmukh started her professional journey with a career in content writing. Endowed with an MBA degree in marketing, she believes in the power of content and its prominence in today’s fast-paced world of online marketing. She aims to provide meaningful insights to the masses through her articles that span myriad verticals, such as business, technology, automotive, healthcare, and more.