Mobile payments are going to overtake credit cards as the preferred mode of online payments

By analyzing the current market trends, it is apparent that online, mobile and digital currency payments systems are going to overtake conventional debit and credit cards for e-commerce payments. According to the United Nations Body on international trade and development, the share of debit and credit cards will drop by 46% by 2019, while digitization of services is soaring.


E-wallets are gaining ground

The reason behind this exponential drop is the fact that many eCommerce wallet systems are currently being used to make online transactions. Currently, the most popular eCommerce wallet systems include Alibaba, Tenpay, PayPal and Tencent, each of these systems is unique in their own perspective but all provide them provide a safe platform for online transactions. 

These wallet systems have eradicated the limitations that cards entail and the exponential growth of eCommerce has fueled the success of these wallet systems. Presently in China, the market share of the mobile payment market is approximately 23 trillion Yuan which is $3.5 trillion in USD, these figures just represent the first quarter of the year. By the second quarter of the year, there has been an increase by 22.5 % according to a renowned research firm, this enunciates the fact that eCommerce wallets are thriving in our current economic ecosystem.  This research firm also stated that the most popular or preferred payment for businesses is Alipay which is currently being used by 68% of online shoppers.

It seems that Alipay is now going for total market capitalization by integrating with Starbucks to have them allow online payments for customers; they have also integrated with KFC so users can pay via Alipay using a unique facial recognition feature. Furthermore, the report published by United Nations stated that in different regions which are more developed, digital payments are all dominated by eCommerce wallet systems. While in less developed regions, eCommerce wallet systems are slowly gaining more recognition in their respective markets. However, for international or global transactions the most popular mode of payments eCommerce wallet systems.

In addition to the United Nations Body, many surveys have been conducted to understand the nature of the eCommerce market. Back in 2016 the international post corporation which is an association of twenty-four national postal services stated that 41% of online shoppers use eCommerce wallets in twenty-four different countries. They further stated that 33% of people use cards and only 18% use debit cards to make online payments or transactions.

Blockchain will have its share of mobile payment

By taking current market trends into consideration it safe to say that distributed ledger technologies are going to dominate the market. These distributed ledgers include eCommerce wallets and other innovations such as the Blockchain. The reason behind this swift change in the market is due to the fact that these platforms are making online payments safe and much more cost-effective.

Online transactions all have substantial fees and these platforms are providing end users with the ability to minimize costs. Furthermore, these platforms improve security and accelerate the duration of settlements between every party involved. Online transactions also reduce the minimum transaction that is viable in order to make an online payment. These platforms are enabling people with the unique ability of making immediate transfers anywhere around the world and have reduced the costs by a substantial margin.

Businesses are adapting their payment systems

Due to all of the profound benefits that these platforms provide, the popularity of E-wallet systems is increasing every day. Now, most businesses are using these eCommerce wallet systems to make all of their payments and have actually based their entire eCommerce structure using these systems. Businesses in different industries can reduce costs by using these wallets and can also improve the overall operation of the business. These eCommerce wallets are apparently not limited to online transactions as Alipay has already proven that these wallets can be used to make payments at physical stores. This will without a doubt pave the way for more innovative applications for eCommerce wallet systems and only time can tell just how these wallets revolutionize our current economic ecosystem. 

 

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