A new study from Juniper Research, the foremost experts in emerging payments, found the total value of digital wallets transactions will rise from $9 trillion in 2023 to surpass $16 trillion in 2028, growing by 77%.
This trend is driven by growth across both developed and developing markets, as increased adoption of advanced services such as BNPL (Buy Now Pay Later), microloans and personal financial management drives end-user engagement. The study found that in a highly congested wallets landscape, diversifying their appeal to users is vital.
A digital wallet is a software-based system that can act as a storage mechanism for a user’s payment, identity, loyalty, or ticketing information.
Latest Fintech News: OKX Adds OP, MASK and LINK to its Dual Investment Structured Product
Advanced Services to Create New Revenue Streams
The report identified advanced services as a key source of revenue growth for digital wallets. Advanced services, such as BNPL or microloans, are allowing digital wallet providers to diversify their revenue. The popularity of BNPL, especially among younger consumers, will draw greater numbers of users, and generate additional revenue. This approach can be seen with Apple’s roll-out of numerous add-on services, including Apple Pay Later.
Research author, Michael Greenwood, added: “Advanced services give digital wallet providers an opportunity to differentiate themselves in a congested market and generate additional revenue. Super app strategies, which many digital wallets are pursuing, will rely on the effective deployment of advanced services at scale.”
Latest Fintech News: Toobit Announces Global Expansion and Establishment of Local Office in Seoul, Korea
Security & Convenience Key Drivers for User Adoption
The research found security benefits are a key driver of digital wallet use in eCommerce in developed markets. Many consumers do not wish to enter card information online. With digital wallets, this issue is reduced, as tokenisation enables card and other payment information to be used in a highly secure way. The research also identified that as digital wallets become broader, including elements of digital identity, convenience will play a greater role; enabling wallet services to act as more of an all-inclusive app for financial wellbeing.
Latest Fintech News: Cemtrex Closes Acquisition of Heisey Mechanical Ltd. to Expand AIS Industrial Segment
[To share your insights with us, please write to sghosh@martechseries.com]
