Payment Processing Software Market - Forecast(2022 - 2027)

Report Code: ITR 0291 Report Format: PDF + Excel

Payment Processing Software Market Overview

Payment Processing Software market size is estimated to reach $68.7 billion by 2026 at CAGR of 9.6% during the forecast period 2021-2026. Increasing use of digital wallets, mobile banking, credit and debit cards for online transaction, along with worldwide growth of ecommerce sector, has accelerated the growth of this Payment Processing Software industry globally. In addition, the market will also be driven by innovation in payment technology using block chain, the Internet of Things (IoT), Artificial Intelligence (AI), and real-time payments. In 2021, a Payment Processing Software company, NetCents Technology Inc., developed a block chain platform designed for merchants and consumers looking for a better way to transact online with cryptocurrency. Further innovations in security technologies such as tokenization of card details for eliminating fraud is expected to create growth opportunities in the coming years. Similarly, developments in digital payment methods and payment gateway will drive the market growth in the forecast period. Furthermore increasing government initiatives, in order to promote the digital economy and curb the usage of cash, have resulted in increased transactions through e-wallets and point of sale machines. In August 2021, Reserve Bank of India (RBI) announced the availability of National Automated Clearing House (NACH) on all days of the week. Hence these factors are analyzed to drive the Payment Processing Software industry outlook in the forecast period 2021-2026.

Report Coverage

The report: “Payment Processing Software Market – Forecast (2021-2026)”, by IndustryARC covers an in-depth analysis of the following segments of the payment processing software market.

By Mode of payment: Debit card, Credit card, e-wallets and others.
By Deployment: On-premise, Cloud.
By Organization size: small and medium enterprises, large enterprises.
By Platform: Browser-based, App-based.
By Technology: BHMI-UPI, QR code, Near-field communication (NFC), Magnetic secure transmission (MST), EMV cards, RFID and others.
By End User industry: BFSI, Retail & e-commerce, Healthcare, Education, transportation & logistics, Hospitality and others.
By Geography: North America (U.S, Canada, Mexico), Europe (Germany, UK, France, Italy, Spain, Russia and Others), APAC (Japan, China, India, South Korea, Australia and Others), South America (Brazil, Argentina and others) and RoW (Middle east and Africa).

Key Takeaways

      • North America dominated the market by a market share of more than 32.7% in 2020, early adoption for new technologies and increasing adoption of online payment methods are the key factors contributing to the market growth.
      • The spread of the coronavirus and governments’ subsequent reaction has led to a surge in the adoption in contactless payment methods such as card and mobile payments
      • Retail & e-commerce is the fastest growing segment among the other end-user industry segment, growing at a CAGR of 10.5% in the forecast period, the wide availability of smartphones, coupled with increasing usage of mobile wallet apps.
      • Cloud deployment is growing at a highest CAGR of 10.8% in the forecast period as it offers operational flexibility and real-time deployment to the companies compared to on-premises solutions. It also offers numerous benefits, including reduced operational costs, simple deployment process, and higher scalability in terms of connected resources.


      Payment Processing Software Market, by Geography, 2020

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      Payment Processing Software Market Segment Analysis - By Mode of Payment

      Cloud deployment is growing at a highest CAGR of 10.8% in the forecast period as it offers operational flexibility and real-time deployment to the companies compared to on-premises solutions. It also offers numerous benefits, including reduced operational costs, simple deployment process, and higher scalability in terms of connected resources. The cloud-based customer self-service software comprises of applications with a set of multiple services that are compliant with the service-oriented architecture and provide robust transformation processes to meet business objectives. Additionally, the cost-effective cloud-based solutions ease installation when compared to the on-premises solutions. Further several companies have been developing processing software in cloud deployment. In 2019, Silicus Technologies, LLC developed a payment processing system leveraging modern application architectures developed and deployed natively in the Cloud. Furthermore, the highest level of data security and reliability offered by the cloud deployment are increasing the share of cloud deployment in the Payment Processing Software market in the forecast period 2021-2026. 

      Payment Processing Software Market Segment Analysis - By End-User Industry

      Retail & e-commerce is the fastest growing segment among the other end-user industry segment, growing at a CAGR of 10.5% in the forecast period, the wide availability of smartphones, coupled with increasing usage of mobile wallet apps, is also contributing to segment market growth. In addition the mass adoption of ecommerce and online shopping has enhanced the growth of digital payments during the Covid-19 pandemic. Moreover several consumers are increasingly moving away from cash and opting for contact-free and digital payments. In 2020, MasterCard Spending Pulse has reported record growth rates across the globe as consumers increasingly attracting towards e-commerce websites. It has reported that MasterCard Spending Pulse grew by 93% year-over-year in the month of May 2020 and is expected to grow at a similar phase during the forecast period. Further the growing e-commerce industry in countries such as India, China, Srilanka, Japan and so on coupled with expanding consumer base, is expected to contribute to market growth. In Sri Lanka e-commerce giants like Takas, Wow and MogoSuper are starting to offer digital payment options as the primary methods of making payments. In India the market has seen explosive adoption over the last five years and the Covid-19 pandemic has further accelerated this trend. Furthermore government and private firms are working hard to bring more of Indian’s population online through initiatives like Digital India. Many E-commerce companies across the globe have stopped are planning to stop cash transactions in the forecast period. In 2020, Paytm had stopped cash-on-delivery (COD), a popular payment mode and a mainstay of e-commerce transactions in India. According to RBI, the consumers shifted towards digital methods of transactions such as debit cards, credit cards, e-wallets and other various mobile payment modes is expected to reach a daily average of 1.5 billion in the next 5 years. Consequently, the net value of digital payments in India will also increase from its current value of $70 billion to $200 billion by 2025. Hence, the above mentioned factors are analyzed to drive the Payment Processing Software market share in the forecast period 2021-2026.

      Payment Processing Software Market Segment Analysis - By Geography

      North America dominated the market by a market share of more than 32.7% in 2020 and is estimated to witness a significant amount of growth during the forecast period 2021-2026, owing to early adoption of technology, growing penetration of internet and online transaction methods. In June 2020, FBI published a report, according to which 75% Americans used different banking apps last year and the numbers had increased by 8% in just two months. In addition to this, presence of major market players and their business strategies for development of payment processing software is fuelling the market growth of this region. In July 2019, by acquiring First Data Corporation, Fiserv became one of the major providers of payment and financial technology provider. Moreover, companies such as PayPal, Amazon and so on have been offering real time payments. In 2020, Visa Inc. and PayPal shared details about an extension of their global partnership, which will expand real-time access to funds for consumers and small businesses that are sending or receiving money via PayPal, Venmo or Xoom. Amazon, Apple and Google are also supporting a real-time payments network in the U.S. led by the Federal Reserve. Hence these factors are analysed to drive the Payment Processing market share in the forecast period 2021-2026.

      Payment Processing Software Market Drivers

      Initiatives provided by governments across the globe is driving the market growth:

      Governments of several countries are pushing players in the banking and payments ecosystem to encourage cashless payments at merchant outlets through digital payments. The Government of India has launched various initiatives to help promote digital payments. Initiatives such as Digital India, the launch of Unified Payments Interface (UPI) act as catalysts in the shift towards digital payments. In 2021, the government has committed to spend more than $200 million in the coming year to incentivize digital payments adoption in the country. These initiatives help promote digitalization and increase awareness about the advantages of the use of new technologies. Moreover, government of countries such as U.K, Kenya are collaborating with several local players to push the growth of the market. In 2020, Judopay had partnered with UK government to drive adoption of digital payments across the public sector in the country. Similarly in Kenya, the local mobile phone company Safaricom with the support of government has pushed the envelope and created a system known as M-Pesa to allow customers to make payments directly from their phones. Hence government initiatives that promote digitalization and usage of digital payment platforms are anticipated to contribute to the Payment Processing Software market growth in the forecast period 2021-2026.

      Rise in the adoption of contactless payments owing to Covid-19 pandemic is analysed to drive the market:

      The spread of the coronavirus and governments’ subsequent reaction has led to a surge in the adoption in contactless payment methods such as card and mobile payments. According to a report given by the Payments Journal in March 2020, there has been a 30% increase in the use of contactless payments since the outbreak of the pandemic. In Germany, contactless payments increased from 35% to more than 50% as a result of the pandemic. Similarly, the US saw the largest absolute rise in contactless adoption, with 46 percent of American responding they had a contactless payment method up from 38 percent previously. In U.K, the number of respondents who indicated contactless as their preferred payment method rose nine points from 50 percent pre-coronavirus to 59 percent. Moreover several companies have also witnessed significant growth in number of users. For instance, according to the report given by Paytm, the company has witnessed 20% growth in the digital payments as compared to the regular days. Also, since February 2020, the company also witnessed an increase in the number of users visiting the Paytm app and the number of sessions per user. Moreover in 2020, Accenture predicts $7 trillion in consumer spending will shift from cash to cards and digital payments by 2023. Hence rise in adoption of contactless payment will drive the Payment Processing Software industry growth in the forecast period 2021-2026.

      Payment Processing Software Market Challenges

      Increasing Cyber Threats, data breaches across various sectors which is acting as a major challenge in hampering the market growth

      With growing penetration of payment processing software and rapid digitalization, the security threats are also rising exponentially. The increasing number of cyber-attacks, data braches and other security threats across various sectors is a major challenge for this market. In January 2020, 15,000 credit and debit cards were cancelled by Alpha Bank, Piraeus Bank, Eurobank and the National Bank of Greece after a tourist service portal was hacked. In January 2021, Juspay, a mobile payment solution provider, had suffered a massive attack which exposed the data of 10 crore card holders. This type of data breaches and cyber-attacks triggers the question regarding the organization’s security system. Apart from that, in the current situation, a sudden rise in usage rare of digital platforms for various payment services in different sectors has increased due to global pandemic which is a lucrative opportunity for the cyber-attackers. Hence the growing cyber-attacks hamper the Payment Processing Software market growth in the forecast period 2021-2026.

      Payment Processing Software Market Landscape

      Technology launches, acquisitions, Partnerships and R&D activities are key strategies adopted by players in the Payment Processing Softwaremarket. In 2020, the market of Payment Processing Software industry outlook has been fragmented by several companies. Payment Processing Software top 10 companies include:

      1. Adyen
      2. Alphabet Inc.,
      3. BlueSnap
      4. First Data Corporation
      5. Global Payments PayU
      6. Jack Henry & Associates Paysafe
      7. PayPal Holdings Inc.
      8. Stripe
      9. Square Inc.
      10. Visa Inc.
      11. Fisrev, Inc.

      Acquisitions/Technology Launches/Partnership

      • In January 2020, PayPal partnered with UnionPay International (UPI) to accelerate their network growth. According to the partnership agreement, PayPal offered its support for global acceptance of UPI.
      • In July 2019, FIS, Inc.had acquired Worldpayto become a leader in technology and solutions provider for merchants, banks, and capital markets.

      Relevant Report Titles:

      Contactless Payment Market
      Report Code: ITR 0064

      Digital Payment Market
      Report Code: ITR 53630

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      1. Payment Processing Software Market Overview
          1.1 Definitions and Scope
      2. Payment Processing Software Market - Executive Summary
          2.1 Market Revenue, Market Size and Key Trends by Company
          2.2 Key trends By Product Type
          2.3 Key trends segmented by Geography
      3. Payment Processing Software Market – Market Landscape
          3.1 Comparative Analysis
              3.1.1 Product/Company Benchmarking-Top 5 Companies
              3.1.2 Top 5 Financial Analysis
              3.1.3 Market Value Split by Top 5 Companies
              3.1.4 Patent Analysis
              3.1.5 Pricing Analysis (Comparison of General Price Offerings in the Market)
      4. Payment Processing Software Market – Industry Market Entry Scenario Premium (Premium)
          4.1 Regulatory Scenario
      5. Payment Processing Software Market – Startup Company Scenario (Premium)
          5.1 Venture Capital and Funding Scenario
          5.2 Startup Company Analysis
      6. Payment Processing Software Market Analysis (Enterprise License)
          6.1 Ease of Doing Business Index
          6.2 Case Studies
          6.3 Customer Analysis
          6.4 Market Share By Product Type
          6.5 Market Share By Sales Channel
          6.6 Market Share By Vehicle Type
          6.7 Market Share By Country
          6.8 Competition Matrix
      7. Payment Processing Software Market - Market Forces
          7.1 Market Drivers
          7.2 Market Constraints
          7.3 Porters five force model
              7.3.1 Bargaining power of suppliers
              7.3.2 Bargaining powers of customers
              7.3.3 Threat of new entrants
              7.3.4 Rivalry among existing players
              7.3.5 Threat of substitutes
      8. Payment Processing Software Market – By Strategic Analysis (Market Size -$Million/Billion)
          8.1 Value Chain Analysis
          8.2 Opportunities Analysis
          8.3 Product Life Cycle/Market Life Cycle Analysis
          8.4 Suppliers and Distributors
      9. Payment Processing Software Market – By Mode of payment (Market Size -$Million/Billion)
          9.1 Debit card
          9.2 Credit card
          9.3 e-wallets
          9.4 Others
      10. Payment Processing Software Market – By Deployment Mode (Market Size -$Million/Billion)
          10.1 Cloud
          10.2 On-Premise
      11. Payment Processing Software Market – By Organization Size (Market Size -$Million/Billion)
          11.1 SMEs
          11.2 Large enterprises Others
      12. Payment Processing Software Market – By Vehicle Type (Market Size -$Million/Billion)
          12.1 BHMI-UPI
          12.2 Near-field communication (NFC)
          12.3 Magnetic secure transmission (MST)
          12.4 EMV cards
          12.5 RFID
          12.6 Others.
      13. Payment Processing Software Market – By Platform (Market Size -$Million/Billion)
          13.1 Browser-based
          13.2 App-based
      14. Payment Processing Software Market – By Industry (Market Size -$Million/Billion)
          14.1 BFSI
          14.2 Retail & e-commerce
          14.3 Healthcare
          14.4 Education
          14.5 Transportation & logistics
          14.6 Hospitality
          14.7 Others
      15. Payment Processing Software Market - By Geography (Market Size -$Million/Billion)
          15.1 North America
              15.1.1 U.S
              15.1.2 Canada
              15.1.3 Mexico
          15.2 South America
              15.2.1 Brazil
              15.2.2 Argentina
              15.2.3 Chile
              15.2.4 Colombia
              15.2.5 Others
          15.3 Europe
              15.3.1 Germany
              15.3.2 France
              15.3.3 UK
              15.3.4 Italy
              15.3.5 Spain
              15.3.6 Russia
              15.3.7 Netherlands
              15.3.8 Others
          15.4 APAC
              15.4.1 China
              15.4.2 Japan
              15.4.3 South Korea
              15.4.4 India
              15.4.5 Australia
              15.4.6 Indonesia
              15.4.7 Malaysia
              15.4.8 Others
          15.5 RoW
              15.5.1 Middle East
              15.5.2 Africa
      16. Payment Processing Software Market - Market Entropy
          16.1 New product launches
          16.2 M&A's, collaborations, JVs and partnerships
      17. Payment Processing Software Market – Industry Competition Landscape (Premium)
          17.1 Market Share Global
          17.2 Market Share – Top Regions
      18. Payment Processing Software Market – Key Company List by Country Premium (Premium)
      19. Payment Processing Software Market - Company Analysis
          19.1 Adyen
          19.2 Alphabet Inc.,
          19.3 First Data Corporation
          19.4 Global Payments PayU
          19.5 PayPal Holdings Inc.
          19.6 Company 7
          19.7 Company 8
          19.8 Company 9
          19.9 Company 10
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