53% of online purchases will be made with digital wallets by 2025
Mobile/digital wallets have become a mainstay of online payments in a short time, and according to figures presented by SafeBettingSites.com, mobile/digital wallets will account for 53% of all e-commerce transaction volume by 2025 .
In a short time, they have become the preferred payment method on e-commerce platforms. Other traditional means of payment, such as credit or debit cards, have lost a lot of ground in the battle for digital payments.
According to figures available on Statista.com, 49% of global e-commerce transaction volume came from digital/mobile wallets. The growth in popularity of wallets is expected to continue and by 2025 they are expected to account for 51% of trading volume.
Credit cards were the second preferred means of payment, with only 21% market share. Debit cards were the third preferred method, with 13%. Credit and debit cards accounted for a combined market share of 34%, which is still significantly lower than the percentage of digital/mobile wallets. The share of credit cards is expected to drop to 19% by 2025, while the share of debit cards is expected to remain the same.
Direct bank transfers accounted for 7% of transaction volume last year. By 2025, bank transfers are expected to drop to 6%.
Additionally, the Buy Now Pay Later (BNPL) payment method is the newest entrant in the digital payment market. 3% of e-commerce payments were made via BNPL in 2021. BNPL’s popularity will continue to grow, and its share is expected to increase to 5% in 2025.
Cash on delivery was an essential payment method in the nascent stages of the e-commerce industry. However, COD accounted for only a 3% share in 2021. By 2025, only 1% of e-commerce payments will be made by COD.
The Asia/Pacific market has been driving the popularity of mobile/digital wallets. In 2021, mobile/digital wallets accounted for 69% of e-commerce transaction volume in Asia/Pacific.
The North American market was the second most popular market for mobile/digital wallets, with a market share of 29%. However, credit cards remain the preferred digital payment method, with a 31% market share.
The share of mobile/digital wallets in the European market was slightly lower at 27%. However, wallets were the most popular online payment method in Europe.
Mobile/digital wallets were least prevalent in online markets in Latin America and MEA, with 19% and 17% market share, respectively.