Proximity Payment Market Expected to Reach $46.80 Billion By 2030—Allied Market Research

According to a recent report published by Allied Market Research, titled, “Proximity Payment Market By Offering and Application: Global Opportunity Analysis and Industry Forecast, 2021–2030,” the global proximity payment market size was valued at $13.98 billion in 2020, and is projected to reach $46.80 billion by 2030, growing at a CAGR of 12.9% from 2021 to 2030.

Increase in adoption of smartphones and access to high-speed internet and increase in use of proximity payments among merchants drive growth of the global proximity payment market. As the popularity of mobile-based proximity payments has increased, there is a massive expansion & growth in mobile point of sale (mPOS) infrastructure in the market. Moreover, there is a rise in trend in the mPOS infrastructure, which further indicates rapid migration toward a cashless system and enhances emergence of in-person payment experiences. Restaurants, retailers, and merchants are the largest end user segments that adopted proximity payments method in their existing businesses.

Furthermore, the global proximity payment 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, 95% of South African consumers consider using at least one emerging payment method, such as contactless, proximity, cryptocurrency, biometrics, or QR code in the next year. In addition, as several stores were closed in order to maintain social distancing, retailers worldwide moved their businesses online and adopted the potential of proximity payment and other contactless transaction mode.

By application, the grocery stores segment is acquired major proximity payment market share. Increased adoption & implementation of proximity payment services by various food & grocery stores owners for improving the speed of the transaction and to attract large customer base drive the growth of proximity payment industry.

Region wise, Europe dominated the market in 2020, and is expected to maintain the proximity payment market trends during the forecast period. Traditional lenders have slowly begun to reopen for providing proximity payment and consumers are offered with higher interest rates and often with greater restrictions, which therefore propels the market growth in this region. However, Asia-Pacific is expected to grow at the highest CAGR during the forecast period. There is a massive adoption of new payment technologies, such as QR codes, cryptocurrencies, and biometrics, among retailers, merchants, & restaurants and increased smartphones penetration & internet usage in the region.

COVID-19 Impact Analysis

The demand for proximity payment has increased considerably during the COVID-19 pandemic. This is attributed to increased familiarity toward payment technology among consumers and several governing bodies across the globe are taking initiatives to stop the spread of virus by initiating various policies. For instance, in the UK, the health minister has proposed to launch a new application that would help National Health Service (NHS) test and trace. In addition, this new launch aims to promote contact tracing of COVID-19 infected person and to establish contact between app-enabled smartphones within a certain radius. Thus, these factors promoted the growth of the proximity payment market size during the pandemic situation.     

Key Findings of the Study

• By offering, the solution segment led the highest proximity payment market share, in terms of revenue in 2020.
• On the basis of application, the others segment is expected to exhibit the fastest proximity payment market growth rate during the forecast period.
• Region wise, Europe generated the highest revenue in 2020.  

The key players operating in the proximity payment market analysis include ACI Worldwide, Inc., Alphabet Inc. (Google), Apple Inc., FIS, IDEMIA, Ingenico, Mastercard, PayPal Holdings Inc., Square, Inc., and Visa Inc.. These players have adopted various strategies to increase their market penetration and strengthen their position in the industry.