With the promise of ease of use, speed, and transparency in commercial transactions, e-wallets have become ubiquitous and are generally associated with bigtechs and their complex portfolio of features that embody everything from ecommerce, P2P, POS, and social payments.
According to Technavio market research, the online on-demand home service market by mobile application was expected to grow at a CAGR of 16.6% during the forecast period 2019–2026, and as per Statista, by 2023, the total number of mobile app downloads may go up to 258 billion. It is a fertile market which boomed starting in 2020 and maintained a steady growth. Apart from supply and demand, one of the motors of this growth was also convenience ushered in by tech advancement in fintech and the proliferation and democratisation of payment methods, especially via mobile.
FIS found that digital wallets accounted for 48.6% of ecommerce transaction value in 2021 — representing a bit over USD 2.5 trillion. The company projects that this will continue to increase to 52.5% in transaction value in 2025. Currently, there is a visible focus on Asia when it comes to the boom in mobile payments, with research indicating that China and Japan are major markets for the APAC sector. Chinese apps Alipay and WeChat are still ahead of any competition, with an estimated user base of over a billion users each. And with good reason, considering that any seller can build a digital presence within the platform of these super apps and automatically access its database.
While the widespread dependency of common payment and technological infrastructures on bigtech and the risks associated with this have been the subject of debate for a while, the speed at which e-wallets such as Apple Pay or Google Pay didn’t cease in popularity has been continuously supported by wider smartphone and mobile device penetration.
According to Juniper Research, when it comes to ecommerce payments, there is one primary player that still holds a big part of the global market apart from the above-mentioned. PayPal (and its subsidiary brand Zelle) has been growing at a steady pace especially thanks to its PayPal.me functionality, which enables users to create personalised PayPal links that can be sent via text, email, and/or across social media platforms.
Mobile wallets
While Tap to Pay is becoming a pillar of mobile payments and is proliferating through the US (Square and Adyen being the main recent enablers for ecommerce when it comes to Apple’s Tap to Pay), Google is keeping up on Android through integrations of its own (playing the same game, but with an increased focus on India’s UPI).
A recent update coming from Google saw the bigtech roll out an internal rival, Google Wallet, to function in tandem with the Pay functionality in some counties. The new app is said to have been already adopted at a large scale in the US and is making its way through the rest of the world. The new wallet is meant to contain all the functionalities of the Google Pay e-wallet, from storing credit and debit cards to loyalty programmes and boarding passes. In addition, though, users will be able to digitise vaccine cards, student IDs, and even use Google Wallet as a digital car key.
On-demand apps
Estonia-based hire vehicle company Bolt has announced it raised approximately USD 709 million at a valuation of USD 8.4 billion to continue expanding its super app. The company operating in Europe and beyond will use the money to improve its ride-sharing market, expand the 15-minute grocery delivery option Bolt Market, and build new ‘dark stores’ in other cities.
Uber, on the other hand, partnered with prominent mobility services to expand both its reach and functionality (it now accepts crypto payments on its Food Delivery app alongside DoorDash, while also announcing it will integrate Rakuten’s services into its Uber Eats and Uber mobility app in Japan).
This article was first published in Payment Methods Report 2022, the most updated overview of trends and developments in the payment methods space and the innovative technologies that these methods work upon, emerging consumers habits, and strategies on how to win at conversion and retention.
About Alexandra Constantinovici
Alexandra is Senior News Editor at The Paypers. A passionate writer, Alexandra has an extensive background in journalism – as a graduate of Journalism and Communication studies –, as well as editing, publishing, and marketing. She coordinates the news coverage at The Paypers and, together with the team of editors, she strives to bring forward the latest trends for our readers, while investigating and sharing with our community the upcoming innovative industry shifts.
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