Digital wallets to be No. 1 e-commerce payment method in Australia by 2025: FIS report
Credit/charge cards remained the leading online payment method among Australians in 2021, accounting for a third (33%) of e-commerce transaction values. However, a new report released today from financial technology leader FIS is forecasting digital wallets to overtake credit/charge cards to become the leading e-commerce payment method in Australia by 2025.
Buy now, pay later (BNPL) is also proving very popular in Australia and its share of e-commerce transaction value will continue to increase, from 11% in 2021 to a projected 14% in 2025.
The 2022 Global Payments Report by Worldpay from FIS, now in its seventh year, examines current and future payments trends across 41 markets. The report found that Australia’s e-commerce market will continue to demonstrate robust growth of 11% CAGR through 2025. Australia also saw one of the largest relative expansions (22%) at point-of-sale (POS) in APAC in 2021, reflecting steady recovery from the impact of the COVID-19 pandemic.
E-commerce Payment Trends
The FIS report found:
- Australia’s e-commerce market is set to grow by more than half (51%) between 2021 and 2025 to $70.7 billion (USD) in transaction value.
- In 2021, the leading online payment method was credit/charge cards which accounted 33% of transaction value, followed by digital wallets (26%), debit cards (15%) and BNPL (11 percent).
- Digital wallets are projected to overtake credit/charge cards to become the leading e-commerce payment method by 2024.
- BNPL is the fastest growing online payment method and projected to account for 14% of e-commerce transaction value by 2025 – trailing only New Zealand in APAC where BNPL is expected to claim 17% of online transaction value.
Point-of-sale (POS) Payment Trends
The FIS report found:
- POS transaction value rebounded strongly in 2021, with Australia seeing one of the largest relative expansions in APAC at 22%.
- Cash is in steep decline, and Australia is expected to have the lowest cash share in APAC in 2025 with cash accounting only 2% of POS transaction value.
- Debit cards (41%) and credit cards (35%) were the leading POS payment methods in 2021 and are projected to retain these leading positions through 2025.
- As Australian consumers shift away from cash at POS, mobile wallets – the fastest growing offline payment method – are capturing consumer loyalty and are on track to account for 16 percent of in-store transaction value by 2025.
To download the complete report, including the methodology, please visit https://worldpay.globalpaymentsreport.com/
