As rapid innovation continues to fuel the growth of the digital payment space, fintechs, banks, and telecoms need to continually adapt and “quickly develop their strategy to compete for market share,” according to McKinsey & Company.
That’s already taking place globally, particularly within some emerging markets. McKinsey says:
“Globally, between 2018 and 2021, the number of noncash retail payment transactions have increased at a compound annual growth rate of 13 percent; while in emerging markets, that figure is 25 percent. Some of the fastest growth occurred in emerging markets in Africa (Morocco, Nigeria, and South Africa) and Asia. Strong growth is expected to continue in some emerging markets over the next few years, with projected CAGRs of 15 percent between 2021 and 2026.”
What’s driving this shift is more of a focus on contactless payments, as well as eCommerce. Which is something we have seen as well. And growth certainly may look different depending on the region for a variety of different reasons. For example, a government in one region may be pushing for more digital payments versus cash payments, which long-term means that adoption will increase and consumer behavior will begin to lean more towards digital.
Accessibility and education of what’s out there is another factor.
As we continue to keep an eye on the ever-changing space, we’ll see more upgraded payments infrastructures and more strategies around how to innovate in the digital payments landscape.
