Global digital payment transaction values are expected to reach $5 trillion by 2021.
This is according to a Juniper Research report titled "Strategies for Payment Providers: Opportunities, Risks & Competition 2017-2021", which reveals global digital payments will reach $3.6 trillion this year.
The report highlights the increasing dominance of Chinese companies in digital payments, with around $3.4 trillion expected to come from sales outside mainland China as players such as Alibaba, Tencent and UnionPay seek to bolster their revenues through international expansion.
According to the research, Alibaba and Tencent are keen to capitalise on the growing spend by both Chinese tourists and immigrant workers, now worth over $200 billion per annum. Potential game-changing decisions by the companies are Alipay's move to roll out instore payments in Europe and Tencent's efforts to deploy its WeChat wallet, which processed more than $1.2 trillion in domestic payments in 2016, across international markets.
This week, Alipay announced plans to introduce the mobile payment app to the South African market, to enable local businesses to accept payments from touring Chinese customers.
Meanwhile, online payment platform UnionPay is seeking to position itself as an alternative to Visa and MasterCard in a number of markets.
Juniper Research author Dr Windsor Holden says: "UnionPay is struggling to gain domestic traction behind Alibaba's Alipay, which is able to bypass UnionPay's network when mobile payments are processed to offline merchants. Hence, its focus is increasingly on building traffic from cross-border and international transactions."
According to the latest expectations and experiences consumer trends survey from financial services technology solutions Fiserv, consumers are paying more bills from mobile devices and making more person-to-person payments as they venture into digital wallets. Faster payments continue to be important to global consumers, with 76% saying it is somewhat important that the payments they make are delivered in real-time.
"Consumers are living more digital lives, and that is being reflected in the way they pay," says Mark Ernst, COO of Fiserv. "Bill payments and person-to-person payments from mobile devices are making their way toward the mainstream, while digital wallets are showing slow but steady growth reminiscent of the early days of online banking."
James Wester, research director, worldwide payment strategies at IDC Financial Insights, says as consumers' reliance on smartphones grows, as well as their level of trust that the devices are safe and secure, so will their use of mobile devices to complete transactions.
"The necessary pieces to spur consumer adoption of mobile payments are finally in place," he notes.
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