FINTECH:

DIGITAL PAYMENTS
DATA AND ANALYSIS WITHIN THIS REPORT
Overview

Pages Subject Essentials

03 05 Detailed overview
Global market size of US$2,221 billion in 2016
Market scope
The US accounted for 29% of the global Digital
Customer benefit, market size Payment market
Future developments, assumptions and sensitivity China led Mobile Payment transaction value with
US$67.7bn in 2016
06 07 KPI-Comparison
Chinas transaction value will almost triple by 2021
Market KPI comparison by region in charts
US Mobile Payments will grow at an annual rate of
Market KPI comparison by region in tables
62% between 2016 and 2021

08 09 Framework
With 85% of all FinTech transaction value in 2016,
Key Takeaways Digital Payments were the main growth drivers
Digital Payments as part of the FinTech market Development is driven by the increasing value of online
purchased goods and services

10 12 Driving Forces and future outlook

Statista Digital Market Outlook

Barriers of digital payment checkouts will be mini-
Driving Forces: Seamless integration & biometric authentication
mized through innovative and convenient solutions
Future Outlook 2025
Blockchain technology shows highly disruptive potential

13 15 Structure, contacts and imprint In cooperation with:

2
FINTECH MARKET
Market focus: Digital Payments

ePublishing
Streaming Downloads

Videogames Video on Demand

Statista Digital Market Outlook

3
Focus Segments Other Segment Reports
PAYMENTS ARE THE STARTING POINT OF THE
DIGITAL REVOLUTION IN FINANCIAL SERVICES
Customer benefit
Cash or Digital Payments? The
digitalization of financial
services is often associated with a
disruptive change within the
industry.
First signs of the FinTech
revolution can be identified
within payment services. PayPal is
probably the most successful
player in this field as of today.
Digital Payments are defined as
non-cash transactions processed
through digital channels and
include:
Digital Commerce: All physical
and virtual goods or services
that have been purchased
online.
Mobile Payments: All
transactions at the point-of-sale
in retail locations processed via
The key question in this context is:
Will Digital Payments substitute
cash transactions entirely? The
answer to this is strongly related
to the customer benefit that is
offered by the digital alternative.
Criteria that must be fulfilled to
generate actual customer benefit
include simplicity of use,
especially for people that are not
tech-savvy, broad or ubiquitous
acceptance, reasonable trans-
action speed, costs and security.
In short: Minimal barriers of
entrance for consumers and
merchants. Other important
aspects are convenience and the
impact of value added services
such as personal finance
management, or the possibility to
receive relevant personalized
offers or coupons.
Market size
With a global transaction value
of about US$2,221 billion in 2016
the Digital Payments segment
made up by far the biggest share
of the total FinTech market.
The comparably high transaction
value is driven by the vast amount
of products and goods purchased
online and incorporate all e-
Commerce transactions or travel
bookings. This is why Digital
Commerce accounted for about
93% of total transaction value.
Mobile Payments contributed to
the digital payments value with
about 5% or US$106 billion, in
2016. The remaining 2% were
inter-national P2P Money
Transfers.
From a regional perspective the
US, China and Europe contributed
quite similar shares to the global
With a high coverage of Internet
connectivity and smart device
penetration, the adoption of
digital payment services in most
developed countries is mainly a
question of convenience and
added value to the existing
infrastructure.
Nonetheless, there are about 2
billion people worldwide that live
outside the financial system,
meaning that they do not have
instant access to bank accounts,
the ability to send money or pay
bills in a secure and convenient
way.
Therefore Digital Payments offer a
great potential to provide equal
services standards in terms of
financial services on a global scale.
"The promise of FinTech is that

Statista Digital Market Outlook

personal smart devices. In each of the aforementioned transaction value. The US Digital you can make transactions
payment categories the Payment transaction value
P2P1 Money transfers: All
importance of breakthrough
much quicker and much less
cross-border payments between amounted to US$605bn (27%) in
criteria might differ and also the expensive
individuals, not including 2016, followed by China with
cultural mindset of the people US$587bn (26%) and Europe with David Schulman, CEO of PayPal
domestic peer-to-peer
shows regional differences in US$541bn (24%).
transactions.
terms of adoption.
1: Peer-to-Peer
4
MOBILE AND SEAMLESS: PAYMENTS NEED TO
BECOME EASY AND FLEXIBLE
Future developments
The future of payments: Its
consent that the way we pay for
goods and services or send money
between individuals will change
radically due to emerging digital
services.
The question is, in which way and
how fast will it happen and is it
possible for established players
(banks and financial institutions) to
adapt to the new technology? The
greatly feared alternative would
be that new market entrants
disrupt the existing market
structure with innovative
business models, an efficient
infrastructure and higher focus on
consumer needs.
Globally the Digital Payment
industry is expected to double its
transaction value by 2021 and
reach US$4,644bn. Mobile
Payments are expected to grow
more than 8-fold between 2016
and 2021 at a compound annual
growth rate of 52%.
At the same time Digital
Commerce volume is expected to
grow at 12%, but shifting more
and more to digital wallet
solutions such as PayPal and
Apple Pay, while credit card
payments are going to become
less lucrative for card networks
and issuing banks.
"We had this great system
called Visa and Mastercard, which
we built for years, but it gets
attacked on expense.
Brian Moynihan, CEO Bank of America
In terms of regional differences,
the US, Europe and China will
account for 73% of the global
digital payment transactions in
2021, compared to 78% in 2016.
Only Chinas share of the global
transaction volume will increase
to US$1,546bn or 33%.
Though growth rates show high
double-digit figures in the Western
world, relevant market growth is
added by yet unbanked and
mobile-first countries in the next
couple of years.
Assumptions and sensitivity
We believe that the payment
industry is facing three major
trends with sustainable long-term
impact: seamless commerce,
mobile payments & blockchain
technology.
Seamless integration of payment
processes gains relevance in every
context, whether its online
shopping, in-store purchases or
peer-to-peer payments. Ease of
use is key to guarantee high
conversion rates and consumer
adoption. High security standards
throughout the payment process
will most likely be ensured by
biometrical methods such as
fingerprint authentication.
Another important factor is the
growing impact of mobile devices,
not only for POS shopping but also
for mobile checkout-processes in
the e-Commerce world as well as
the integration of P2P payments
into messengers and social
networks. Time spent on mobile
screens increases continuously,
and anytime, anywhere payment
transactions become more
familiar. Especially in less
developed mobile-first countries,
high convenience and usability on
mobile devices is inevitable.
A third dimension is blockchain
technology, which is closely
connected to crypto-currencies.
Here we have a completely new
technology without any
established players in the market.
Advantages of the technology are
promising to allow secure direct
transactions without
intermediaries.
The impact of blockchain on
financial regulation is not clear
as of today. The European
Commission states that existing
regulation will still apply, but
like in other areas of FinTech,
regulation can have an
unforeseeable impact on the
Statista Digital Market Outlook
future development of the
markets.
Bottom line is that technological
progress cannot be argued away,
but consumers will determine
the speed of adoption.
5
DIGITAL PAYMENTS IN MA JOR REGIONS
Market KPI comparison by region
United States China Europe

Transaction Value forecast

in million US$ by region +21.4% p.a.

+13.1% p.a. 1,545,600

602
+12.6% p.a.
1,194,428 396,073
P2P Money Transfer:
43,909 979,766
274,418 67,433
Mobile Payments: 645,876 104,877
587,039 541,394
24,925 15,620 191 1,148,926
67,744 6,628 17,903
Digital Commerce: 876,101 807,457
605,331 519,103 516,864

2016 2021 2016 2021 2016 2021

Transaction Value per user

in US$ by region
3,383 1,113 1,489

2016 717 2016 346 2016 296

330 321 241

Statista Digital Market Outlook

4,309 1,607 2,035

2021 2,736 2021 1,104 2021 1,360

915 647 853

Source: Digital Market Outlook 2016

6
DIGITAL PAYMENTS IN MA JOR REGIONS
Market KPI comparison by region
United States China Europe

Revenue
CAGR1 CAGR1 CAGR1
Segment Unit 2016 2017 2018 2019 2020 2021 2016 2017 2018 2019 2020 2021 2016 2017 2018 2019 2020 2021
16 21 16 21 16 21

total mUS$ 645,876 738,340 848,935 968,808 1,087,603 1,194,428 +13.1% 587,039 786,119 1,007,060 1,216,815 1,399,824 1,545,600 +21.4% 541,394 617,254 704,284 797,628 892,118 979,766 +12.6%

Digital Commerce mUS$ 605,331 660,266 719,811 778,889 832,750 876,101 +7.7% 519,103 647,574 787,644 923,695 1,047,663 1,148,926 +17.2% 516,864 574,318 635,253 696,354 755,401 807,457 +9.3%

Mobile Payments mUS$ 24,925 55,018 99,369 154,445 214,683 274,418 +61.6% 67,744 138,272 219,056 292,672 351,631 396,073 +42.4% 6,628 16,355 32,840 54,932 79,932 104,877 +73.7%

P2P Money Transfer mUS$ 15,620 23,056 29,755 35,474 40,171 43,909 +23.0% 191 273 361 448 530 602 +25.8% 17,903 26,581 36,191 46,342 56,785 67,433 +30.4%

Users

CAGR1 CAGR1 CAGR1

Segment Unit 2016 2017 2018 2019 2020 2021 2016 2017 2018 2019 2020 2021 2016 2017 2018 2019 2020 2021
16 21 16 21 16 21

Digital Commerce m 178.9 184.7 190.1 195.0 199.4 203.3 +2.6% 466.2 506.3 551.5 601.6 656.5 714.8 +8.9% 347.1 359.0 370.2 380.4 389.3 396.8 +2.7%

Statista Digital Market Outlook

Mobile Payments m 34.8 46.5 60.1 74.3 87.9 100.3 +23.6% 195.9 227.0 259.8 293.3 326.6 358.9 +12.9% 22.4 33.1 44.9 56.7 67.9 77.1 +28.0%

P2P Money Transfer m 47.4 47.7 47.8 47.9 48.0 48.0 +0.3% 0.6 0.7 0.8 0.8 0.9 0.9 +9.3% 74.4 75.7 76.8 77.7 78.4 79.0 +1.2%

1: CAGR: Compound Annual Growth Rate/ average growth rate per year.
Source: Digital Market Outlook 2016 7
KEY TAKEAWAYS
Market sizing subjects for Digital Payments
United States
At US$645 billion the US had the
biggest Digital Payment market
contributing 29% of the global
Market size transaction value in 2016
About 94% of transaction value came
from Digital Commerce transactions,
mainly e-Commerce purchases and
online travel bookings
Overall growth in Digital Payments is
expected to be at 13% between 2016
and 2021
Growth rate
Mobile Payments will outpace average
market growth by a factor of five with
an average annual growth of 61.6%
The user base of Mobile Payment
solutions will triple by 2021
The US payment landscape is leading
technological development &
innovation
Trend signals
Large players such as PayPal, Apple,
?
Amazon & Facebook are putting
significant amounts of money into
online and mobile payment solutions
1: CAGR: Compound Annual Growth Rate/ average growth rate per year
2: Domestic peer-to-peer transactions are not included in out market definition in terms of transaction value
Source: Digital Market Outlook 2016
China
China was the second largest single-
country market with a total transaction
value of US$587 billion in 2016
Already largest Mobile Payment
market in 2016 with US$68bn and
196m active users
Highest CAGR1 of about 21% in total
transaction value
By 2021, the Chinese Digital Payment
value is expected to reach US$1,546bn
Mobile Payments will account for 25%
of total Digital Payment transaction
value in 2021
As a mobile-first country, China sets
standards for mCommerce shopping
as well as mobile POS-solutions
Very strong integration of payments in
social messaging services, e.g. WeChat
Domestic2 P2P payments will be way
more relevant than cross-boarder
transactions
Europe
At US$541 billion the European market
is slightly smaller than the US and the
Chinese market
UK and Germany are leading markets
within European payment landscape
Mobile Payments account for only 1%
of total Digital Payments due to low
user adoption
The European annual market growth is
estimated to be at 13% from 2016-21
74% CAGR is expected in Mobile
Payments due to the very low market
value as of 2016
Growth drivers: increasing eTravel &
Commerce adoption as well as roll-out
of Apple Pay & comparable services
Evolving FinTech startup landscape,
especially in P2P Money Transfers with
players like TransferWise or
Statista Digital Market Outlook
Worldremit
Uncertain development for UK
payment industry due to Brexit and
leaving of SEPA
8
DIGITAL PAYMENTS DOMINATE FINTECH
Global segment sizes and growth rates

Global1 FinTech Transaction Value CAGR2 16 21

in million US$ by segment
6,962,224

+21.8% p.a.

4,644,250

+15.9% p.a.

2,600,853
+36.4% p.a.

565,187
FinTech:
2,221,688

Statista Digital Market Outlook

+46.5% p.a.
Digital Payments:
1,752,788
Business Finance:
119,599
Personal Finance: 259,566
2016 2021

1: Only includes countries listed in the Digital Market Outlook

2: CAGR: Compound Annual Growth Rate/ average growth rate per year 9
Source: Digital Market Outlook 2016
DRIVING FORCE: SEAMLESS INTEGRATION
Trend Explanation:
In the future, payment features
will be integrated into all kinds of
everyday objects. From cars to
smart TVs almost every
personal object will be able to
participate in payment
transactions.
This will enable customers to pay
even faster and more easily. A
physical contact is not strictly
necessary when money is
exchanged digitally. Waiting
times will either be reduced to a
minimum or completely done
away with.
When driving out of a car park, the
length of stay will be recorded
automatically. The payment will
be made directly from the car.
Customers will just have to
confirm the amount on a display
inside.
For safety reasons, integrated
payment transactions will be
limited to small amounts.
However, future authentication
methods could solve this problem.
The wearer of an item of clothing
with an integrated payment
feature could, for example, be
recognized by his heartbeat or
vein structure.
Integrated payment features
accelerate transactions and
provide greater convenience
Future applications:
Checkout areas will become
obsolete. Supermarket
customers will pay for their
goods using their jackets or
coats.
Pay-as-you-go: There need be
no tickets in public transport
systems. When boarding a bus,
payments can be triggered by
passengers shoes.
Vehicles with integrated
payment features enable a
contactless payment of
refueling and parking charges.
POWERED BY
Micro-Trend: MasterCard Key
MasterCard has partnered with
the chip manufacturer
Qualcomm to work on
technologies that add a payment
feature to everyday objects.
General Motors has been
recruited as a partner and will
add the payment system to its
keys. This system is based on
chips which MasterCard has
modified and made part of a
token.
Micro-Trend: Lyle & Scott Jacket
Scottish fashion brand Lyle &
Scott has developed a jacket
which allows its wearer to make
The credit payments.
contactless card company
The
sleeve includes a small pocket
into which is inserted a special
Statista Digital Market Outlook
payment chip that supports the
Barclays Bank "bPay" payment
system. The jacket costs 149
and is available in blue and
black.
10
DRIVING FORCE: BIOMETRIC AUTHENTICATION
Trend Explanation:
The rapidly growing dangers in the
digitization process have
increased the need to protect
data and privacy in digital
spaces too this applies to the
Future applications:
finance sector in particular.
To guarantee a higher level of
security in the future, conventional
authentication systems like PINs,
passwords and cards will be
replaced by biometric methods.
Personal methods will be used,
including fingerprint, facial and iris
recognition. Highly individual
physical features like heartbeat,
vein structure and skull echoes
will provide even safer ID solutions
that are completely resistant to
attempted fraud by cyber
criminals.
Behavior analysis is yet another
approach. The software
meticulously monitors keystrokes,
mouse movements and
touchscreen contacts. Any
deviations from these patterns
indicate potential identity theft.
POWERED BY
Micro-Trend: Bunq 4 Fingers TouchlessID
Biometric methods set new
The Dutch mobile-only bank
standards and ensure the Bunq aims to offer customers a
highest level of security secure log-in via mobile devices
by using "VeridiumID" and hand
recognition software to
Online shopping payments can authenticate users based on four
fingerprints.
be verified by selfies
Bank employees can confirm The technology can be applied to
the identity of customers via any modern smartphone with at
video chats least a five megapixel camera
and flash.
Payments via voice command
can be accepted by an analysis
of voice patterns
Micro-Trend: NatWest BioCatch
The vital signs recorded by a
smartwatch enable the wearer
The British bank NatWest is
to make transactions
testing BioCatch technology,
which uses behavioral
biometrics to authenticate
visitors to websites.
Statista Digital Market Outlook
The system captures more than
500 behavior points, such as
hand-eye coordination, pressure,
hand tremors, navigation,
scrolling and various finger
movements.
11
FUTURE OUTLOOK 2025
Blockchain as future infrastructure in POWERED BY
payment transactions
The blockchain is the software
basis of the virtual currency
Bitcoin. It is used as a secure
digital record of transactions.
The technology ensures a faster
and more efficient exchange of
information.
Blockchain technology makes
trust an integral component of
technology in general. All
transactions are stored in a
fraud-proof ledger. This ledger
is filed decentrally for large
numbers of clients and is
therefore highly secure.
Trust-building organizations like
banks and insurance companies
could be gradually replaced by
the decentralized network due to
the fact that major functions can
be performed by the technology
itself. Rules, contracts and
processes can be programmed
on the blockchain and therefore
transformed into automated
processes.
The revolution will initially run in
the background, in the back-end.
1: DApps: decentralized applications
Customers first contact with the
blockchain will be via smart
contracts or DApps1.
Musicians royalties can be
automatically paid via the
blockchain when people listen
to their songs, without a record
company being involved.
Insurance policies for flight
delays will pay out immediately if
an airlines flight data reports a
delayed plane. People will no
longer have to waste time
claiming compensation. The
amount of self-generated solar
power can be calculated without
checks by a utility company and
credited to the users account via
the blockchain.
These services-on-the-
blockchain will also give many
people access to global capital
Statista Digital Market Outlook
markets, who previously did not
even have a bank account due to
structural or political reasons.
This also includes the enormous
field of micro-transactions that
often lack profitability due to
relatively high transaction costs..
12
DIGITAL PAYMENTS TYPES OF TRANSACTIONS
Market Structure and definition
Segment
Digital Payments
Includes payments for
consumer products and
services which are made
over the Internet, mobile
payments at Point-of-Sale
(POS) via smartphone
applications as well as
cross-border Peer-to-Peer
transfers between private
users.
The following are not
included in this segment:
transactions between
businesses (Business-to-
Business payments), bank
transfers initiated online
(that are not in connection
with products and services
purchased online), and
payment transactions at the
Point-of-Sale where mobile
card readers (terminals) are
used.
Types of transactions Out of segment
Consumer transactions made via the
Domestic peer-to-peer
Internet which are directly related to online
shopping for products and services. Online money transfers (e.g. via
Digital Commerce transactions can be made via various messenger apps)
payment methods (credit cards, direct
debit, invoice, or online payment providers,
such as PayPal and AliPay).
Includes transactions at Point-of-Sale that Traditional bank transfers
are processed via smartphone applications
(so-called mobile wallets). Well-known
providers of mobile wallets are ApplePay,
Mobile Payments and Samsung Pay. The payment in this case
is made by a contactless interaction of the
smartphone app with a suitable payment
Business-to-Business
terminal belonging to the merchant.
Payments
Peer-to-Peer (P2P) money transfers are
Statista Digital Market Outlook
defined as money transfers made over the
Internet between private individuals. Cross-
P2P Money Transfers border payments and remittances are the
Point-of-Sale card payments
at mobile card readers
most relevant segments for the FinTech
market. (mPOS terminals)
In scope Out of scope 13
ABOUT DIGITAL MARKET OUTLOOK

9 Markets, 34 segments & 85 sub-segments Details

Digital Media Connected Car 50 countries
Video-on-Demand, Digital Music, Connected Hardware, Vehicle Services,
Video Games, ePublishing Infotainment Services Direct access & downloads
7-Year coverage: 2015 2021
FinTech Revenue forecasts
Digital Payments, Business Finance,
Smart Home
Personal Finance
Home Automation, Security, Home
Entertainment, Ambient Assisted Living,
eTravel Energy Management
Online Travel Booking, Mobility Services

e-Commerce
User count & penetration
eServices Fashion, Electronics & Media, Food &
Personal Care, Furniture & Appliances, Toys,
Event Tickets, Fitness, Dating Services, Hobby & DIY
Food Delivery

eHealth Digital Advertising

Diabetes, Hypertension, Heart Failure Banner Ads, Video Ads, Search Ads,
Social Media Ads, Classifieds Comparable data

Statista Digital Market Outlook

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IMPRINT
Contacts and author

In cooperation with:
Tobias Bohnhoff
Head of Market Analytics
Tobias Bohnhoff studied Geography and
Innovation Management.
TRENDONE knows the products and technologies of the future.
He gathered deep knowledge of digital
transformation processes and innovative As an inspirational assistant we help you to understand the latest
business models in numerous research and trends & innovations that will influence your industry.
consulting projects before he started to build up With our Insights we help you to interpret these innovations to match
the Digital Market Outlook team at Statista. your needs.

E-MAIL tobias.bohnhoff@statista.com WEB statista.com/outlook WEB www.trendexplorer.com

Released: January 2017

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Disclaimer
This study is based on survey and research data of the previously mentioned sources. The forecasts and market analysis presented were researched and prepared by Statista with great
care.

For the presented survey data, estimations and forecasts Statista cannot assume any warranty of any kind. Surveys and forecasts contain information not naturally representing a reliable
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