A new study from Juniper Research (www.juniperresearch.com) forecasts that consumer spending on digital commerce will reach $14.7 trillion by 2022, up by 60% on last year’s figure of $9.2 trillion.
The research group found that the largest global contributor to payments was currently QR code-based offline purchases for physical goods, which now account for one-third of all Chinese in-store payments by value. However, according to the study, although QR codes will have further growth in the Indian Subcontinent and Africa, their value will be eclipsed worldwide by online purchases by 2022.
Juniper found that with retailers increasingly offering localized payment mechanisms and friction at checkout reduced by stored credentials, migration from offline to online is likely to accelerate. What’s more, it highlighted moves by traditional ‘bricks and mortar’ retailers to develop omni-channel strategies as they seek to shore up revenues by using mobile apps both for online purchases and to drive in-store footfall.
The study also found that money transfer would be a key growth area, bolstered by rapid expansion and adoption of social payments. It highlighted the activities of companies such as PayPal (via its Venmo and Xoom subsidiaries) and Facebook in the space; arguing that these players were in pole position to capitalize on the increasing transition to digital of P2P payments.
Additionally, the report claims that players across the ecosystem were poised to benefit from implementing blockchain technology for financial settlement. It argued that blockchain would enable increased standardization for payment processing; substantially reduce the risk of error (including double spend) and indeed the time taken for error checking; resulting in faster, more secure and less costly processes. This in turn would allow money transfer companies to become more competitive, reduce fees to end users and thereby experience high usage volumes.