Dive Brief:
- Revenue from card payments and transactions using other payments tools in North America is expected to rise to $436 billion in 2030, from $339 billion last year, according to a report from the Boston Consulting Group released Sept. 23. Globally, the consulting group projects that transaction revenues will climb to $1.03 trillion by 2030, from $770 million last year.
- In North America, the annual growth rate of that payments transaction revenue will slow to 5% between 2025 and 2030, down from 7% between 2019 and 2025, per the report. Meanwhile, the worldwide transaction revenue growth rate is projected to slow to 6% between 2025 and 2030, down from 8% between 2019 and 2025, the report said.
- Including revenue not directly related to transactions, such as interest income and overdraft fees, North America payments revenue rose 8% to $842 billion as of last year and is expected to increase 5% to $1.07 trillion by 2023, Boston Consulting predicted. That makes it “by far” the largest revenue pool, the firm said.
Dive Insight:
In its latest report, Boston Consulting Group continues to sound the alarm about reduced growth in payment revenues, echoing a report last year.
Driving the payments revenue growth in North America are continued expansion of e-commerce and card payments as well as growing payment acceptance, according to the firm’s report released last week. Still, its growth will not be as robust as other parts of the world, partly given its existing larger size.
“The slowdown will not be uniform,” the report said. “The largest revenue pools are generally expanding at a more moderate pace, with the smaller Latin America and the Middle East and Africa markets poised to outpace them.”
As consumers shift their payments away from cash and checks toward digital payments, e-commerce and cross-border payments increased, and instant payments continued to expand, the report noted. However, the transition toward digital payments will slow in mature markets, and factors such as changing regulations, new payment rails and fierce competition are weighing down payments providers’ profits, according to the firm’s recent report.
Last year, Boston Consulting predicted that global payments revenue would grow at 4% annually from 2024 through 2029, down from 8.8% yearly growth since 2019. The previous report attributed the limited growth to increased card usage and the adoption of instant payments, among other factors.
Other research suggests that consumers are increasingly turning to non-cash payment methods. A Federal Reserve Financial Services survey of 6,079 Americans found that debit and credit cards were their top payment methods, followed by cash in third place.
