UK-based market research company Juniper Research is projecting a 50 percent revenue growth in the payments platforms by 2014, touching $154 billion.
According to the new market study by the company, the payments sector is one of the rapidly growing fintech areas, which will generate a total revenue of $106 billion by the end of this year.
The company believes that social payments like WeChat Pay will contribute vastly to the growth of the sector. It is also bullish on the Chinese markets and is projecting 50 percent of the revenue to be generated from that single market.
The company detailed that it accessed 16 payment gateway platforms to conduct the market research and also scored the gateways on service capabilities, extent and breadth of offerings, and future market prospects. Fiserv aced the list primarily because of its acquisition of First Data, which allows it to create end-to-end payment solutions. PayPal, FIS, CyberSource, and Adyen also made it to the top five.
Demand for new services
The research study also stressed the importance of diversification of the platforms with new services to remain competitive in the market. According to the company, services like store management solutions, customer insights, and merchant capital finance are very crucial.
“The market will move beyond solely offering payments in the near future by expanding to new services. These value-added services will enable payment platforms to differentiate themselves in a saturated market and build out new business models to allow vendors to generate additional revenue,” Dr. Morgane Kimmich, author of the research report, stated.
The report also detailed that payment-related fraud will also increase at a pace of 70 percent over the next five years.
Meanwhile, the payments sector is also seeing a push from the companies to introduce blockchain-based payments networks. Facebook is at the forefront of creating a payments ecosystem on its platform by introducing a digital currency, while, Chinese central bank is also developing its own digital yuan.
(Photo: WeChat Pay)