Payment as a Service Market Expected to Reach $53.6 Billion by 2031—Allied Market Research

According to a new report published by Allied Market Research, titled, “Payment as a Service Market," The payment as a service market was valued at $8 billion in 2021, and is estimated to reach $53.6 billion by 2031, growing at a CAGR of 21.4% from 2022 to 2031.

Payment as a service providing companies are increasingly designing next-generation solutions for consumer and enterprise-oriented services. Moreover, government agencies also demand for a need to shift toward modern payment tools and techniques. The payment services companies integrate several emerging technologies such as Europay, Mastercard and Visa cards (EMV), blockchain, near field communication (NFC), and integrates Payment Card Industry Data Security Standard (PCI DSS) compliance to maintain a secured payment environment.

Factors such as increased smartphone penetration & incorporation of online payment services, rise in e-commerce sales, and increase in reliance on cloud technologies propel the payment as a service market growth. In addition, support & initiatives of the government toward payment as a service market and untapped potential of emerging economies are expected to provide lucrative opportunities for the payment as a service market in the coming years. Moreover, the global payment as a service market is in its developing phase, and exhibits high growth potential, due to rise in need for operational efficiency & transparency during transactions and surge in demand for customized digitalized payment options globally. For instance, according to a study conducted by Mastercard in 2020, about 95% of South African consumers consider using at least one emerging payment method, such as contactless, mobile payments, cryptocurrency, or QR code in the next year.

On the basis of payment method, the cards segment acquired major share. This is attributed to the fact that card payment services provide convenient payment options for customers along with security. In addition, it offers a range of payment solutions to help merchants for analyzing customer behavior & metrics.

On the basis of region, North America dominated the payment as a service market share in 2021 during the forecast period. This is attributed to growth in technology adoption in the payment industry and rise in online transactions.

The demand for payment as a service has increased considerably during the COVID-19 pandemic. This is attributed to increased familiarity toward digital payments among consumers and initiatives by governing bodies across the globe to curb the spread of virus by initiating various policies for conducting payments. Moreover, payment as a service method is expected to be intact by economic downturn and is anticipated to remain high during the forecast period. These factors, thus promote the growth of the payment as a service industry during the pandemic situation.     

KEY FINDINGS OF THE STUDY

• By industry vertical, the BFSI segment led the highest payment as a service market share, in terms of revenue in 2021.
• By payment method, the app/eWallet segment is expected to exhibit the fastest growth rate during the payment as a service market forecast period.
• Region wise, North America generated the highest revenue in 2021 in payment as a service market size.  

The key players operating in the payment as a service market analysis include Aurus, Inc., Alpha Fintech, ACI Worldwide, Apple Inc., First Data (Fiserv, Inc.), Google, LLC, Ingenico, Mastercard, Paysafe, PayPal Holdings, Inc., Paystand, Pineapple payments (Fiserv, Inc.), VeriFone, Inc., Visa Inc., Valitor, PayU, and Obopay. These players have adopted various strategies to increase their market penetration and strengthen their position in the payment as a service industry.