1
STATE OF THE INDUSTRY REPORT
State Of The Industry Report 2025 Executive Summary The payments landscape is full of exciting innovation and yet paradoxically, the way people pay for goods and services in some of the wealthiest parts of the world differs little from how they paid 20 years ago. In this year’s State of the Industry Report, we investigate the global payments landscape in 2025 in search of the perfect payment method. We believe this analysis will provide an analytical framework to bring industry stakeholders together so we can shape innovation around end user needs. In Section 1, we analyze five different characteristics of what we think makes a perfect payment method. Three of these are what we refer to as micro (business-level) characteristics – security, cost and user experience – and two are what we refer to as macro (market-level) characteristics – acceptance and governance. In Section 2, we profile six different payment methods: Cash, Cards (debit and credit), Digital Wallets (pass-through and staged/stored-value), Pay by Bank (bank transfer and real-time payments), Buy Now, Pay Later (BNPL), and Stablecoin; although, there is a lot of overlap between some of these payment methods. In Section 3, we bring it all together in our payment method scorecard, using our analysis in Section 2 to assign scores and provide weightings. Debit Cards Still Lead the Way in 2025 Our analysis shows that debit cards are the leading global payments method in 2025, with a score of 18.3. Debit cards score well on security, user experience and acceptance. Although debit doesn’t score as well on cost and governance, regulations in many parts of the world capping debit card fees and mandating debit card co-badging and merchant choice routing have managed to protect end users. Credit cards do not score nearly as well as debit cards on our framework, mostly because of a lack of fee caps, co- badging and merchant routing choice on credit cards. Real-time payments are the most prominent examples of Pay by Bank and they score well here, with UPI in India and Pix in Brazil two stunning examples of quick success. The major question here is whether other countries can experience similar growth - the RTP infrastructure is there in many countries, but consumer- to-business (C2B) penetration outside of Brazil and India is limited. Digital wallets made big headlines towards the end of the 2010’s with the rapid growth of WeChat and Alipay in China. Both businesses had large, loyal customer bases from their core business and were able to successfully layer payments on top, while merchants were attracted by relatively low acceptance fees. While we haven’t seen this level of success for digital wallets outside of China, there are several attractive characteristics that are reflected in our scorecard here. Cash feels like the odd-one-out in a world increasingly full of digital payments, but we would not rule it out yet. Cash scores surprisingly well on cost and although it can’t match card in terms of user experience and security infrastructure, we’ve seen the decline of cash volumes tail off and in an uncertain geopolitical world it could retain its appeal for a while yet.
11
Powered by FlippingBook