While we are still some way off from a completely cash-free society, there has been massive growth in non-cash transactions in recent years. Much of this is being driven by the increase in mobile payments, as smartphones become more accessible and affordable around the world. Markets such as Latin America, Asia and Africa have seen a proliferation of mobile payment services, where many people have limited access to traditional banking.
Mobile network providers offer services that allow customers to use their mobile device as a hub to store, receive and send money via different methods. While mobile payments are not yet the most popular way to conduct digital payments, the trend shows that this method is set to take more and more of the market share.
This growth is facilitated by the increase in the number of global merchants that support mobile payments. Proximity payments at point of sale are on the rise in particular, with an estimated 1.31 billion users of this method in 2023, an increase of 360 million since 2019. China leads this market globally, with more than 80 per cent of mobile users making regular point of sale mobile transactions.
The value of the worldwide mobile payment market is expected to reach over $67 billion in 2023, and in 2022 more than $2 trillion worth of mobile transactions were made globally. The growth rate is also impressive, projected to see a compound annual growth rate of more than 36% up to 2030. While cash and card payments currently still account for the majority of transactions, mobile payments are expected to overtake to become the dominant method by 2025.
So, who are the current leaders in the mobile payments game? Obviously this varies considerably according to region, with some providers operating globally while others only serve a few markets.
Overall PayPal is still in pole position in most western countries, where plenty of online casinos that accept PayPal remain popular. It speaks to the brand recognition that PayPal casinos are considered the most trustworthy. In the US, 36% of mobile wallet users prefer PayPal.
PayPal, founded in 1998, has experienced significant growth in its customer base over the years, becoming one of the world’s leading online payment platforms. In 2010, the company reported around 94 million active users, which increased to approximately 143 million by 2013. By 2016, PayPal’s active user base had grown to about 197 million, and by 2019, it had reached roughly 305 million users.
Globally it is a very different story, with Alipay the undisputed leader in terms of the number of users. Founded in 2004 as an offshoot of the highly successful e-commerce company Alibaba, Alipay is estimated to have more than a billion users in China and other parts of Asia. Alipay has also expanded to other parts of the world, primarily to assist consumers in its core markets to make online mobile purchases from other countries.
Alipay is what is known as a ‘super-app’, combining a large number of different services in one convenient place. As well as mobile payments customers can purchase transport tickets, pay bills, order food and perform many other tasks on the app.
Alipay’s closest competitor in the Asian market is WeChat Pay, founded in 2013. The company has seen a steep rise in users within a relatively short time, and the app is estimated to have close to a billion users in 2023. WeChat was already a popular social media app used by the majority of China’s internet users, so there was a built-in customer base for the launch of its mobile payments service. 88% of WeChat Pay users are located on mainland China, but it is still the world’s second largest mobile payment provider by number of customers.
Apple Pay and Google Pay
Elsewhere, Apple Pay and Google Pay remain as strong contenders in the mobile payment market. Apple has consolidated its lead in the US after some disastrous missteps from Google. In 2021 a new Google Pay app rollout proved to be a calamity, with severely reduced functionality for most customers. It was not only customers who abandoned Google Pay after the debacle, and the division head quit along with many other employees. A change of leadership has seen some improvements in the company’s fortunes, but it will take a while for the US market to recover their trust in Google Pay.
Apple Pay, in the meantime, is going from strength to strength. Only around half of iPhone users also use Apple Pay, so there is still a lot of untapped market. This number is expected to increase as more online and physical vendors and businesses start to accept Apple Pay.
In March 2023 the company started to roll out Apple Pay Later to customers in the US. This service allows users to pay for purchases in four instalments with no fees or interest over six weeks. Apple is also offering micro-loans of up to $1000 for purchases with participating merchants. Apple’s continued innovation is what keeps driving it forward as a leading payment provider. We expect to see it pull further ahead of Google pay in the coming years as more customers become iPhone owners.