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CMSPI – IAC State of the Industry Report
CMSPI – IAC State of the Industry Report
checkout solutions can store the customer signature for months or even years, allowing for a faster checkout experience as customers no longer require signature per transaction. This is especially important for merchants operating quick checkouts, like fast-food restaurants, who may seek to ensure customers checkout as fast as possible to increase throughput and keep lines moving. In addition, supplier partners increasing contactless limits on SEPA-LV transactions are giving merchants access to competing routes for higher transaction values, creating more leverage and competition for merchants operating in Germany (see Section 5 for a detailed look at SEPA in Germany).
DIGITAL PAYMENT METHODS IN EMEA Rising Utilization of A2A and Open Banking Payments in EMEA Europe
Many major economies within Europe operate an account-to-account (A2A) alternative payment rails, with varying levels of penetration. 164 The Nordic countries tend to exhibit some of the highest levels of penetration, but this varies depending on the country’s payment provider landscape. For example, Sweden has been one of the most prominent digital payments markets 165 which has led to growth in the country’s A2A system SWISH, which is fourth largest A2A provider in the region. 166 In other countries, however, A2A payments for retail transactions haven’t had the same explosive growth due to provider limitations and suboptimal customer experiences limiting the growth of these solutions. For example, in Germany, the evolution of the SEPA-LV payment method for retail has proved a solid case study of how improvements to the customer experience can enhance the viability of A2A payments. A2A Case Study on SEPA-LV The Single Euro Payments Area (SEPA) payment initiative enables customers to make payments via direct debit to anywhere in the European Union. SEPA-LV refers to SEPA Lastschrift, which allows customers to permit a merchant, typically using signature authentication, to initiate a payment within the SEPA system, pulling funds from the consumer’s account. SEPA-LV acceptance for in-store transactions used to be a pain-point for retailers as a result of a complicated customer experience and the risk of payment default. Previously, the consumer and the retailer underwent a cumbersome authentication process to pay and accept SEPA-LV payments, as customers were required to physically sign a receipt for each SEPA-LV transaction. For merchants and their providers, there was no way to validate the consumer’s available balance, creating a risk that the merchant would be unable to recoup the funds of the transaction, or that the customer would request a chargeback up to eight-weeks from the purchase date, reversing the direct debit. As a result, merchants most typically used SEPA for low value transactions with well-known customers, given the risk of receiving the payment, or as offline backup options when their terminal lost connectivity. As of 2023, the market has evolved, as new checkout solutions featuring stored digital signatures allow for long-term direct debit mandates. For example, while customers paying with SEPA previously had to sign each receipt to authenticate the transaction, new
DIGITAL PAYMENT METHODS IN APAC Digital Wallets in Asia
Digital wallets, also known as e-wallets, have significantly reshaped the financial landscape in Asia, emerging as integral components of the region’s transition toward a cashless and digitally driven economy. These digital payment solutions have become central to the daily transactions of millions across the continent. 167 With a mobile-centric approach, e-wallets leverage the high mobile device penetration rates in Asia, 168 providing users with a seamless platform for transactions, fund transfers, and financial management directly from their smartphones. China China has the most mature digital wallet payments market globally, with 56% of POS and 81% of ecommerce spend through digital wallets. The volume is dominated between WeChat Pay and AliPay, with a forecasted 1 billion and 1.25 billion users in 2023 respectively and taking around 91% of China’s total wallet share. 169 170 In July 2023, both wallets announced that users could now link their Visa, Mastercard, and Discover cards to the apps, making it easier for international users to pay. 171 Indonesia Digital wallets have emerged as a prominent alternative to cash, growing to 28% of POS value in Indonesia in 2022. 172 The market includes players like OVO (subsidiary of the Singaporean super app Grab), DANA (subsidiary of the China-based Ant Group), GoPay and LinkAja (wallets with investment from the Indonesian super app Gojek). 173
167 Digital payments in the Asia-Pacific region - statistics & facts | Statista 168 https://www.insiderintelligence.com/content/rising-smartphone-usage-paves-way-ecommerce-opportuni- ties-southeast-asia 169 Alipay vs WeChat Pay users 2025 | Statista 170 Alipay and WeChat Pay Add Links to Visa and Mastercard | PYMNTS.com 171 https://www.pymnts.com/news/payment-methods/2023/alipay-and-wechat-pay-add-links-to-visa-and-mastercard/
164 https://7834608.fs1.hubspotusercontent-na1.net/hubfs/7834608/European%20A2A%20Schemes%20Thriv- ing%2c%20Not%20Yet%20Open%20Banking%20Payments_Update31Oct2022.pdf 165 https://www.irishtimes.com/business/personal-finance/in-cashless-sweden-even-god-now-takes-collection-via-an- app-1.3083429 166 https://www.statista.com/statistics/1420553/biggest-a2a-payment-providers-europe/
172 Worldpay Global Payments Report 2023 173 Worldpay Global Payments Report 2023
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