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Digital Payments to Hit $6.6T Value in 2021, a 40% Jump in Two Years

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Digital Payments to Hit $6.6T Value in 2021, a 40% Jump in Two Years

Even before the pandemic, cashless payments have become an appealing alternative for billions of people.

However, with social distancing rules in place, more people started embracing contactless payments as a safer way to manage their money in both developed and emerging countries.

According to data presented by Finaria.it, the global digital payments industry is expected to hit $6.6trn value in 2021, a 40% increase in two years.

Mobile Payments to Almost Double and Hit $4.6T Value by 2025

The global digital payments industry has seen many innovations over the past few years, including mobile wallets, P2P mobile payments, real-time payments and cryptocurrencies. This new, simple-to-use, cashless payment methods have drawn many users.

Large players like Amazon, PayPal, Apple, and Facebook are continually investing significant amounts of money into online and mobile payment solutions. The ongoing development from separate online shops towards integrated online shopping ecosystems has created space for new business models and opportunities for digital payment methods.

In 2017, the entire digital payments sector was worth over $3trn, revealed the Statista survey. By the end of 2019, this figure jumped by 55% to more than $4.7trn and continued growing. Statistics show the global digital payments industry hit $5.4trn value in 2020, almost a 16% increase year-on-year.

The entire sector is expected to continue its impressive growth in 2021, with transaction value jumping by 22% to over $6.6trn. In the next four years, the digital payments market is set to reach $10.5trn value.

With a global transaction value of about $4.2trn in 2021, the digital commerce segment is set to make up by far the biggest share of the total digital payments market. The high transaction value in digital commerce is driven by a large number of products and services purchased online. It includes all eCommerce, eServices, and digital media transactions or bookings in eTravel. The entire segment is forecast to grow by almost 40% and hit a $5.8trn by 2025.

Mobile POS payments are expected to contribute 37% or almost $2.5trn to the digital payments value in 2021. However, the following years are set to witness impressive growth in the mobile payments segment, with transaction value surging by 90% to $4.6trn by 2025.

Europe Shows the Highest Growth in Digital Payments

Over the years, China and the United States developed into the world’s leading digital payments markets, while Europe’s share remained considerably smaller.

The Statista survey showed Chinese digital payments industry, as the largest globally, is expected to reach a $2.9trn transaction value in 2021, a 16.8% jump in a year. The US market follows with $1.26trn worth of digital payments, 22.6% more than a year ago.

However, Europe is set to witness the most impressive digital payments growth this year, with transaction value surging by 28.3% to $1.17trn. By 2025, the European market is expected to hit $1.95trn value. With a $271.4bn worth of digital payments in 2021, the United Kingdom is the biggest digital payments market in Europe. Germany follows with a $178.2bn transaction value.

The Statista survey revealed that, although growth rates show high double-digit figures in the Western world, relevant market expansion in the following years will be driven by mobile-first countries, especially China.

Statistics also show that most digital commerce users, or 987 million, live in China. By 2025, this figure is expected to jump to over 1.2 billion. However, US users generate the highest average transaction value in digital commerce out of the three major regions, $2,590 in 2020. Statista data indicate this figure is set to reach over $3,000 in 2021 and continue rising to $3,751 by 2025.

Is the CEO/Founder of Investors King Limited. A proven foreign exchange research analyst and a published author on Yahoo Finance, Businessinsider, Nasdaq, Entrepreneur.com, Investorplace, and many more. He has over two decades of experience in global financial markets.

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Telecommunications

Lagos Residents Frustrated by Rapid Data Drain, Call for NCC Action

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Telecommunications - Investors King

Lagos residents are expressing increasing frustration over what they describe as the rapid depletion of their data bundles.

Many subscribers are now calling on the Nigerian Communications Commission (NCC) to address their concerns as they suspect changes in billing practices by telecommunication providers.

Numerous subscribers have reported that their data does not last as long as it used to. A Lagos-based teacher, Mrs. Nafidah Zaynab, shared her experience, stating that a N2,000 data bundle, which previously lasted almost a month, now depletes within just a few days.

This sentiment is echoed by many, including Idowu Anabili, a trader who has reduced his data usage due to rising costs.

Abdullahi Yunus, who runs a café, noted a significant increase in his data expenses, spending between N70,000 and N100,000 monthly, up from N30,000. He attributes this spike to faster data consumption.

Telecom operators deny any wrongdoing, attributing the faster data consumption to increased usage by subscribers.

An anonymous official from MTN explained that the variety of activities performed on smartphones has increased, leading to faster data usage.

Airtel Nigeria’s spokesperson, Mr. Femi Adeniran, suggested that background apps and high-definition streaming contribute to the issue.

Despite complaints, operators assert they have not officially increased data prices. They emphasize that automatic app updates and other technical factors may be responsible for the perceived quick depletion.

Experts suggest that the challenging economic climate may be pressuring telecom companies to subtly reduce data value.

The industry has reported a 43% rise in operational costs, although no formal tariff hikes have been announced.

The NCC has clarified that it has not authorized any increase in data tariffs. The commission highlights technical factors like automatic video play and app updates as potential causes for quick data depletion.

In a bid to assist consumers, the NCC has advised turning on data saver modes and managing app updates to conserve data.

To combat the issue, Mobile Network Operators (MNOs) have initiated a campaign to educate consumers on optimizing their data usage.

They recommend practices such as disabling automatic updates and closing unused apps.

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Social Media

Meta Shuts Down 63,000 Nigerian Accounts in Sextortion Crackdown

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In a significant move to combat online crime, Meta Platforms Inc., the parent company of Facebook, Instagram, and WhatsApp, has removed 63,000 accounts in Nigeria linked to sextortion scams.

This sweeping action is part of Meta’s ongoing effort to address the growing threat of digital extortion on its platforms.

Unmasking the Scammers

The crackdown, which took place at the end of May, targeted accounts engaged in blackmail schemes.

These scammers posed as young women to coerce individuals into sharing intimate photos, which were then used to extort money from the victims.

The removal follows a Bloomberg Businessweek exposé highlighting the rise of such crimes, particularly affecting teenagers in the United States.

The Global Impact

The U.S. Federal Bureau of Investigation (FBI) has identified sextortion as one of the fastest-growing crimes targeting minors.

The schemes often lead to severe consequences, including the tragic suicides of more than two dozen teens.

In one high-profile case, the death of 17-year-old Jordan DeMay in Michigan led to the arrest of suspects traced back to Lagos, Nigeria.

The Role of the Yahoo Boys

Many of the dismantled accounts were linked to the “Yahoo Boys,” a notorious group known for orchestrating various online scams.

These individuals have been using social media to recruit and train new scammers, sharing blackmail scripts and fake account guides.

Meta’s Response

Meta’s spokesperson emphasized the company’s commitment to user safety, stating, “Financial sextortion is a horrific crime that can have devastating consequences.”

The company is continually improving its defenses and has reported offenders targeting minors to the National Center for Missing & Exploited Children.

To enhance protection, Meta has implemented stricter messaging settings for teen accounts and safety notices regarding sextortion.

They are also employing technology to blur potentially harmful images shared with minors.

Ongoing Efforts

Meta’s actions highlight the complex and evolving nature of online crime. The company has pledged to remain vigilant, adapting its strategies to counter new threats as they emerge.

“This is an adversarial space where criminals evolve to evade our defenses,” Meta noted.

Looking Forward

As digital platforms continue to grapple with issues of privacy and security, Meta’s recent actions demonstrate a proactive stance in safeguarding users.

By dismantling these networks, the company aims to reduce the prevalence of sextortion and foster a safer online environment for all.

The crackdown serves as a reminder of the need for continued vigilance and collaboration between tech companies and law enforcement to protect individuals from the harmful effects of digital exploitation.

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Fintech

Flutterwave Celebrates Inclusion in CNBC’s Top 250 Global Fintechs

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Flutterwave has been recognized as one of the Top 250 Fintech companies globally by CNBC and Statista.

Joining the ranks of industry giants like Ali Pay, Klarna, Piggyvest, and Mastercard, this accolade underscores Flutterwave’s impact on the financial technology sector.

This honor follows Flutterwave’s recent inclusion in Fast Company’s Most Innovative Companies list, highlighting the company’s pivotal role in transforming Africa’s payment landscape.

The recognition is a testament to Flutterwave’s dedication to innovation and excellence in providing seamless payment solutions across the continent.

Expressing gratitude, Flutterwave acknowledged its talented team, supportive board, reliable partners, and loyal customers for contributing to this success.

The company continues to drive progress in the fintech industry, reinforcing its commitment to enhancing financial accessibility and inclusion in Africa and beyond.

Flutterwave’s recognition on these prestigious lists marks a proud moment and a significant milestone in its journey, reflecting the company’s growing influence and leadership in the global fintech arena.

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