The global digital payment industry was dramatically affected by the health crisis COVID-19 in 2020 and this resulted in major shifts in the development of the market. Although non-cash transactions were already commonly used in many regions before 2020, the adoption rate of such payments accelerated significantly and is projected to develop even more. Global cashless transactions are projected to increase at about 18% CAGR between 2020 and 2025 and exceed a one and a half trillion mark in the volume. The region with the most contributing numbers is expected to be Asia-Pacific. This already had a mature non-cash payment market in 2020, however, during the next 5 years, the figures are projected to progressively improve. The region following Asia-Pacific is poised to be Europe and then North America in 2025.
Although before the COVID-19 pandemic, mobile payment usage was extensive in some regions, the health crisis accelerated the trend globally in 2020. This is due to the accelerated security and cross-channel payment features of mobile contactless payments. In 2021, the leading country in the share of proximity mobile payment users is expected to be China, making up 87.3% of smartphone users, distantly followed by South Korea and the United States. In China, the share of proximity mobile payment users in the entire population is projected to exceed 67% by 2025. Furthermore, in several regions, mobile wallets have been a crucial way to make payments as authorities attempt to reduce the usage of cash. In Asia-Pacific, for example, the number of mobile wallets in use is projected to more than double over the next years from 2021 to 2025. Although the Asia-Pacific is predicted to be the dominant region in the usage of the mobile wallet, other regions are also forecasted to experience acceleration, such as Latin America, Europe, Africa, and the Middle East. Latin America is forecasted to follow the APAC region in the number of mobile wallets in use, reaching over 600 million by 2025. Even in the emerging markets, where mobile wallets were not commonly adopted in 2020, the forecasts for 2025 show the increased adoption rate. For instance, in Singapore, the penetration rate of mobile wallet payments is projected to surge from about a third to almost 100%, the same goes for Brazil and Mexico.
