Digital Payments in Top Spot

We asked you a quick question a couple of days back, and this blog will not just reveal the correct answer but also give you some fascinating insights related to it!

Our question was, which is the biggest transaction segment in the fintech industry?

Digital payment or online lending?

Well, the correct answer is Digital Payments!?

The digital payments segment Asia 2017-2026 had the biggest transaction value. It was followed by alternative lending, which amounted to around 298 billion U.S. Dollars.?

In fact, according to a report by ACI worldwide, India accounted for the largest number of worldwide real-time transactions in 2021. At 48 billion, the number was three times that of China, its nearest challenger and 6.5 times greater than that of US, Canada, UK, France, and Germany combined.?

Driving forces of digital payments?

Business Growth

Digital payments play a significant role in business growth. They allow them to expand their geographical boundaries and move into a global marketplace. A safe and secured payments partner organizations can reach out to customers worldwide. By 2027, all cross-border payments are projected to be valued at approximately $250 trillion. Thus the right time to be sure your payment solution will help you make the most of the global marketplace.?

Ideas & Innovation?

Innovation in payment solutions is vital in attracting customers to digital payments. As a result, businesses invest in the newest technology and software solutions to make the payment experience more simplified, diverse, convenient, and safe. Not just that, innovation also comes into focus through diverse revenue increasing ideas such as embedding payments into platforms.?

Customer Experience

A good customer experience will have them keep coming back to you, and hence it must not be overlooked. It is also a critical factor driving the transaction value of digital payments.?

Research suggests that $20.1 billion in purchases were abandoned last year as customers could not use their preferred payment methods. Not just that, about 20% of shoppers left their cart at checkout since it was not in their language.?

The demand for a more trustworthy, hassle-free and localized checkout experience is what customers are looking for. This is increasingly important for those businesses expanding into the global market to drive their growth. To cater to this demand, companies are beginning to provide more payment options and localize each customer's payment experience.?

Whether through multiple payment modes or flexible payment options, meeting customer demands will eventually result in higher revenue for businesses.

Government policies

Our Indian Government, with a vision to achieve a cashless economy, has introduced several policies favouring merchants integrating digital payment methods.?

Some of these are:?

Companies having a yearly turnover of more than 50 crores shall offer low-cost digital modes of payment, such as BHIM UPI, UPI-QR Code, debit cards, Aadhaar Pay, NEFT and RTGS, to customers.

The Reserve Bank operationalized the PIDF Scheme from January 01, 2021, and subsidized Points of Sale (PoS) infrastructure (physical and digital modes) in tier-3 to tier-6 centres and northeastern states of the country.

From August 26 last year, beneficiaries of PM Street Vendor's AtmaNirbhar Nidhi in Tier-1 and 2 centres also started getting covered.

As digital payment transactions continue to rise and evolve with changing technological and behavioural trends, we can easily say that the largest segment in terms of evaluation will be digital payments for the longest time.?