India's four-way payment platform conviction: [Special planning] Global payment methods towards diversification

As technology continues to advance, global payment scenarios are gradually diversifying, and payment methods such as credit cards, e-wallets and mobile payments are becoming increasingly popular around the world. However, there are significant differences in the dominant payment methods in different regions. This paper will provide an overview of global payment trends and explore the dominant payment methods in each country.

North America: Credit cards are the preferred method of payment

In North America, the payments scene is dominated by credit card and digital wallet transactions, with Account to Account and Buy Now, Pay Later options also growing rapidly. While Canada and Mexico differ in terms of payment methods, the overall trend in North America is toward a diverse and convenient payments ecosystem.

The United States has a well-established credit card payment system, with six of the world's major credit card organisations, including VISA, MasterCard, American Express and Diners Club, originating in the country. Offering a variety of value-added services and benefits, credit cards are favoured by US consumers and have become one of the most common payment methods. Credit cards are widely accepted for both online and brick-and-mortar purchases.

In addition to credit card payments, digital payments are also popular in the United States. Common digital payment methods include PayPal, Apple Pay, Zelle, and Venmo.In addition, inter-account payments are becoming increasingly popular in the North American market, particularly in Canada, where the growth of inter-account payments has been fuelled by the Interac Online instant transfer system, which enables users to pay merchants directly from their bank accounts.

Europe: Diversifying payment methods

Europe is known for the diversity and regionality of its payment methods, with credit card payments, e-wallets, third-party payments and online bank transfers being the main methods of payment.The two major international credit card brands, Visa and MasterCard, are popular in Europe, especially in countries such as the UK, Spain and Poland. Credit card payments feature prominently in online transactions in Europe, making them a key choice for consumers and businesses.

The main e-wallet and third-party payment services in Europe include PayPal and Klarna, a leading global provider of online payment services with high adoption rates in countries such as Germany, the U.K., and France. Klarna is popular in the Nordic region and offers a wide range of payment options, including buy-now-pay-later, bank transfers, and instalments, to provide consumers with a seamless online shopping experience. In addition, prepaid cards and digital currencies are important payment methods in certain European regions, especially in areas where credit cards or online bank transfers are not popular.

Africa: high proportion of cash used

The main payment methods in Africa are diverse and regionally specific, with mobile payments and digital wallets dominating, while cash and card payments also have significant market shares. This diversity reflects the complexity and variety of African markets.

The mobile payment market in Africa is growing rapidly, especially in Kenya, where mobile payment brand M-PESA has a significant presence in the local market. Furthermore, statistics show that digital wallets are becoming the dominant online payment method in Africa. The share of digital wallets in e-commerce transactions is expected to continue to grow to 27% by 2026, at a CAGR of 25%.In the POS transaction segment, the market share of digital wallets is also expected to increase significantly, from 12% in 2021 to 24% in 2026.In some African countries, such as Kenya, cash payments ( cash on delivery) remains one of the preferred methods, accounting for 40% of the total.

Although card payments hold some market share in Africa, their popularity is relatively low due to the low penetration of credit cards. In addition, bank transfers have a share of the African market, but the exact market share varies by region.

Asia: mobile payments and e-wallets dominate

In Asia, mobile payments and digital wallets are the main payment methods, especially in markets such as China and India.

Despite the dominance of mobile payments and digital wallets in Asia, credit card payments remain important in certain countries and regions. In Southeast Asia, online bank transfers and e-wallets are common payment methods. Mobile payments have been fuelled by the introduction of the Unified Payments Interface (UPI) by the Indian government. Credit card payments are very common in Japan, especially international cards such as Visa and MasterCard. In Southeast Asia, online bank transfers are common, such as FPX and Boost in Malaysia. in addition, the Southeast Asian e-wallet market is booming, with examples such as Gopay and OVO in Indonesia, and Gcash and Dragonpay in the Philippines.

Oceania: digital payments gaining popularity

In Australia and New Zealand, for example, payment methods in Australia are dominated by bank cards and electronic payments, with credit card payments also holding a significant position. Online payment methods and cash payments also have a certain market share. With technological advances, digital payments have become increasingly popular in Australia, providing consumers with a more convenient and secure payment experience. In New Zealand, cash and credit cards are widely used for payments, and mobile payments are also very popular.

Many developed countries around the world, as early adopters of Internet technology and smartphones, have not kept up with the pace of innovation in payment methods. Some analyses suggest that many developed countries have developed a "technological path dependency" and have become accustomed to traditional banking systems and credit card payments, and do not feel an urgent need for new mobile payment methods.

For example, the history of credit card use in the United States dates back to the mid-20th century, a long history that has allowed consumers to gradually develop payment habits. This is true not only in the United States, but also in other developed countries, where credit cards are deeply ingrained in people's payment habits and where consumers' trust and reliance on credit cards has led to a lukewarm response to new mobile payment methods. In addition, mature credit card systems in developed countries offer a diverse range of services and a high level of security. Consumers are used to earning points and rewards through their credit cards, something that mobile payments cannot offer in the short term. Therefore, despite the technological advantages of mobile payment tools, it is not easy to change deep-rooted consumer habits.

Furthermore, although the share of cash payments in the global payment system is declining, it remains an important mode of payment. Especially in some developing countries or regions, the share of cash payments remains high. Germany, for example, is one of the 15 European countries with a high proportion of cash use. Despite the growing popularity of mobile and other electronic payment methods in Europe, German consumers' preference for cash remains strong. Similarly, although Sweden is a leader in the digitisation of its payment system, the Swedish Central Bank emphasised the need for cash payments in its "Payments Report 2024" and recommended legislation to ensure the availability of cash payments. This shows that even in a highly digitised payment environment, cash is still considered an important payment method.

Developed countries attach great importance to the protection of personal privacy and financial security and take a conservative attitude towards new payment methods. As globalisation deepens, the internationalisation of mobile payments faces more challenges, including issues of technical compatibility, financial regulation and international political and economic relations. At present, the diversification of global payment methods has become a trend, and how to avoid the formation of cross-border payment barriers and improve payment convenience may become the focus of attention of countries in the future.