What Are Digital Wallets? Exploring Their Rising Popularity

• Electronic Wallet Transactions: By 2023, digital wallets will have handled over $3.1 trillion in e-commerce transactions worldwide, or an astounding 50% of all e-commerce spending. The broad acceptance and confidence that customers have in digital wallets for their online purchasing needs is demonstrated by this remarkable statistic. This development has largely been attributed to the ease with which one may make secure, one-click purchases without repeatedly entering credit card details.

• The prevalence of digital wallets in online shopping: It is anticipated that digital wallets will continue to dominate e-commerce, with a 15% compound annual growth rate (CAGR) through 2027. By this time, digital wallets are expected to handle more than $25 trillion in global transaction value, maintaining a 49% share across e-commerce and POS transactions combined. This extraordinary development trend demonstrates the increasing demand for digital wallets over traditional payment methods such as credit and debit cards.

• POS Transactions and Digital Wallets' Ascendancy: Digital wallets have continued to gain ground in the worldwide POS payment market. By 2023, these wallets will have handled over $10.8 trillion, or almost 30% of all POS transactions worldwide. The COVID-19 epidemic has led to a considerable increase in the use of digital wallets in physical retail establishments, restaurants, and other point-of-sale contexts due to the simplicity of contactless payment methods.

• Factors Affecting Market Size: A number of factors have an impact on the growing size of the digital wallet market. Technological innovations like Near Field Communication (NFC) and biometric authentication have improved digital wallet usability and security. This development has also been fuelled by shifts in consumer behavior, with more individuals choosing contactless payments and purchasing online. Digital wallet usage picked up speed during the COVID-19 outbreak as consumers looked for touchless, safer payment methods.

• Effect of Digital Wallets on Different Industries: Some industries are changing as a result of digital wallets. They speed up checkout times and offer individualized shopping experiences in retail. The travel and hospitality sectors benefit from streamlined booking and payment processes. In healthcare, digital wallets enable secure and efficient billing systems. These applications highlight the versatility and utility of digital wallets across different sectors.

Conclusion

Based on the linear growth in the market share of digital wallet payments that we have observed globally, the future of digital wallets appears bright. Businesses will need to build their own digital wallets to keep up with this growth trend and prepare their payment systems for the future. Rather than starting from scratch, start your journey with the PayNet Systems digital wallet solution and launch your customized digital wallet at a significantly faster pace.