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Juniper Research: Embedded payments wear down card dominance

Thursday 23 February 2023 08:23 CET | News

Juniper Research predicts that embedded finance vendors’ global revenue from embedded payments will reach USD 59 billion in 2027, wearing down card dominance within ecommerce.

 

The expected growth is 84%, an increase from the 2023 revenue of USD 32 billion, driven by rising consumer enthusiasm in relation to alternative payment methods, which creates a considerable revenue opportunity for embedded finance vendors.

Entitled 'Embedded Finance: Key Trends, Segment Analysis & Market Forecasts 2022-2027', the report predicts that following this surge in integrated payments usage, cards will become less prevalent within the ecommerce space.

Juniper Research findings on embedded payments

Embedded payments refer to payment processing functionalities being embedded within the checkout process on a website and include alternative payment methods of the likes of one-click checkout buttons through digital wallets or Open Banking payment rails.

Based on research findings, the simplicity enabled through one-click payments is believed to be critical in providing a strong user experience. However, this simplicity is under threat following the integration of an increased number of payment options, which creates a ‘cluttered’ checkout process.

Juniper Research predicts that embedded finance vendors’ global revenue from embedded payments will reach USD 59 billion in 2027, wearing down card dominance within ecommerce.

As per the statement of research co-author Nick Maynard, to be able to control the expansion of different payment options at checkout, merchants that are looking to improve their checkout experience should focus on the most prevalent and lowest-cost-to-merchant options so as to drive their success. The belief is that focusing on instant payments-linked channels will decrease the costs significantly when compared with card payments, and thus should be considered a priority for merchants.

Juniper Research findings on B2B payments

What is more, the research forecasts that by 2027, 35% of embedded payments’ revenue will come from the B2B segment. To date, B2B payments have seen less implementation of new payment types, and account payable and receivable processes create an ecosystem that is difficult to manage. This absence of development shows that the B2B market is a comparatively underserved one and the belief is that it should be a priority for embedded finance players as the market grows.

Based on the findings of the report, embedded finance vendors should have a focus on strengthening payment integration with key B2B access channels of the likes of B2B ecommerce marketplaces and accounting software, in order to be able to maximise their appeal in a market that is believed to have high potential.

Juniper Research provides both research and analytical services with the global hi-tech communication sector being its primary target audience, offering consultancy and analyst reports, together with industry commentary.

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Keywords: research, Juniper Research, banking, Open Banking, embedded finance, embedded payments, ecommerce, fintech, payments , B2B payments, marketplace, one-click payments, Open Banking payments, digital wallet
Categories: Banking & Fintech
Companies: Juniper Research
Countries: World
This article is part of category

Banking & Fintech

Juniper Research

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