Digital spending to jump 60 per cent by 2022
Consumer spend on digital commerce will reach US$14.7 trillion by 2022, up by 60 per cent on last year, according to Juniper Research.
Its new report Digital Commerce: Key Trends, Sectors & Forecasts 2018-2022, 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 instore payments by value.
However, says the research, although QR codes will have further growth in the Indian subcontinent and Africa, their value will be eclipsed worldwide by online purchases by 2022.
With retailers increasingly offering localised payment mechanisms and friction at checkout being reduced by stored credentials, migration from offline to online is likely to accelerate, says the report.
Furthermore, it highlights moves by traditional retailers to develop omnichannel strategies as they seek to shore up revenues by using mobile apps both for online purchases and to drive instore footfall.
Meanwhile, Juniper’s study 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 capitalise on the increasing transition to digital of P2P payments.
Additionally, the report claimed that players across the ecosystem were poised to benefit from implementing blockchain technology for financial settlement.
This would enable increased standardisation 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 boost use.