Payment as a Service Market to Reach Valuation of USD 22156.8 Million by 2028 - Rise in using Smartphones, Corporate and Retail Payments Demands are Increasing at a Global Level to Drive the Market Growth

Vantage Market Research

May 08, 2022

From the period 2022 to 2028, the Global Payment as a Service Market is expected to reach USD 22156.8 Million in terms of revenue, growing at a Compound Annual Growth Rate (CAGR) of 23.7%.

Smartphone adoption is rising, which is fuelling the growth of online goods and service sales. Customers can use online shopping mobile apps to have a quick and convenient buying experience. A trend toward digital and cashless transactions is being driven by the demand for a simple and convenient purchasing experience. Smartphone adoption is rising, which is fuelling the growth of online goods and service sales. Customers can use online shopping mobile apps to have a quick and convenient buying experience. A trend toward digital and cashless transactions is being driven by the demand for a simple and convenient purchasing experience. The rise of payment-as-a-service (PaaS) is being spurred by the rise of e-commerce companies around the world. A fundamental shift from an on-premise strategy to a cloud-based service model is one of the key causes driving the rise of PaaS solutions. Customers are looking for a convenient and safe way to pay for their purchases, allowing shops to try out new technology. Many governments have taken initiatives to promote payment options that are based on secure and real-time transactions. Quick, secure payment choices and an optimized customer experience are two main factors driving the global expansion of payment-as-a-service. Retailers are quickly embracing digital payment technology due to the explosive growth of the e-commerce industry.

Key Highlights from the Report

  • On the basis of Power Output, the market is segmented into professional services and managed services. The market is divided into professional services and managed services based on Power Output. Managed services will lead the market in 2020. Managed services are crucial since they are directly linked to improving customer experience; as a result, businesses cannot afford to overlook them because they help them maintain their market position. Companies are finding it increasingly challenging to focus on their core business processes while also supporting a number of other functions, emphasizing the value of managed services. These services provide the technical know-how required to keep API-based payment solutions current and up to date. All pre-and post-deployment questions, as well as customer requests, are handled by managed services. Businesses frequently outsource managed services so they may focus on their core capabilities. The introduction of hosted payment solutions in the Payment as a Service sector is expected to enhance the demand for managed services. Managed services can help merchants reduce infrastructure complexity and operational expenses while also ensuring a secure and global infrastructure.

  • On the basis of Vertical, the market is segmented into retail, hospitality, media and entertainment, healthcare, banking, financial services, and insurance (BFSI), and others (sports and leisure, NGO, government, energy and utilities, and education). In 2021, retail dominated the market. Retailers are progressively integrating digital payment technology to give more comfortable experiences to their customers as the e-commerce industry grows. In 2021, 1.5 billion people throughout the world preferred to shop online, according to the Mobile Payments Conference. There will be 2 billion digital buyers by 2021. According to the British Retail Consortium (BRC), debit cards account for 42.6 percent of all transactions, while cash accounts for 42.3 percent. Cards accounted for 77 percent of all retail spending in the United Kingdom, according to UK Finance. Additionally, retailers are employing cutting-edge technologies to increase their market recognition and presence.

  • is the fastest regional segment in terms of growth. Because of the rising need for integrated payment solutions and developments in payment technology in the Asia-Pacific area, the region is likely to see significant growth. Furthermore, the industry is being propelled by the increasing use of smartphones and the internet in the region. Japan, China, Australia, South Korea, and New Zealand are all making substantial contributions to the region's economy. For example, the Asian Payments Network (APN) is a consortium of 11 Asian countries that promote cross-border banking transactions in the region, including China, Japan, Singapore, Malaysia, Thailand, South Korea, New Zealand, Vietnam, Indonesia, the Philippines, and Australia. In addition, many small retailers previously relied on cash, but are now fast implementing digital payments in order to stay competitive in the market. Consumers in India, for example, were obliged to adopt electronic payments when the government implemented demonetization.

Some of the key players in the Global Payment as a Service Market include First Data (US), TSYS (US), Paysafe (UK), Verifone (US), Ingenico (France), Aurus (US), Agilysys (US) and others.

Market Dynamics:

Smartphone penetrations are growing.

The combination of mobile devices, data, and the cloud has recently fueled an unprecedented rise of fast-growing MNCs with digital platforms. Klarna, a Swedish payments company, received $20 million in funding from fashion retailer H&M in October 2018 to develop an omnichannel payments service for H&M's physical and online stores. The agreement covers 'frictionless' in-store, mobile, and online payments, as well as a better delivery and return process and increased payment flexibility.

Retails and Corporate payments are increasing

The government's legislative attempts to promote payment solutions based on safe and real-time transactions, as well as an enhanced consumer experience for rapid and secure payment methods, are also important factors driving the market's growth. Vendors are providing competent services to efficiently resolve issues with next-generation API-enabled payment platform services. These services aid in the reduction of infrastructure costs, the increase of total revenues, and the enhancement of performance. However, the worldwide payment service provider business is being hampered by an increase in cybercrime. The payment service provider is concentrating on providing more secure options.

North America is holding the largest share. In 2021, the United States will have the highest penetration of digital payment instruments, accounting for the majority of the region's share. In the United States, the most popular digital payment apps are Google Pay, Apple Pay, and Paypal. North America is home to the majority of the largest PaaS solution and service providers. A surge in the use of mobile wallets, which is speeding the expansion of PaaS, is one of the key factors driving PaaS solutions' growth in the region. For secure and real-time transactions, industries including retail and banking are increasingly using PaaS services.