Saturday, September 5th, 2020
Over the last few years, the European digital payments industry has experienced massive growth. Transaction value has risen by more than $200bn since 2017, reaching an impressive $708.3bn in 2020. Data presented by BuyShares has also revealed that the United Kingdom is Europe’s largest digital payments market, generated 25% of that value. In fact, the UK is on track to leap 360% by 2024.
COVID-19 Reshapes Payment Industry
Without a doubt, COVID-19 has reshaped every aspect of daily life for customers and businesses alike – including how they spend their money. As lockdowns swept Europe – and the rest of the globe – there was a huge shift from instore to online commerce. Even long after the lockdowns lift, experts now predict that many consumers will continue to favour the online shopping experience and convenience they have now come to enjoy, rather than returning to physical stores.
According to data released in the Statista 2020 FinTech Report, 81.8% of UK citizens used online payments in 2019, ranking it as the highest share of online payment users globally. As online payments have continued to rise amid COVID-19 lockdowns, the UK digital payments market is now set to reach $164.4bn value in 2020; this is nearly a $10bn increase year-over-year.
UK Payments Industry Forecasted to Double
This incredible increase has been largely driven by mobile POS payments. Last year, the mobile segment of the UK digital payments industry generated $30.9bn in revenue. Meanwhile, digital commerce was the most significant revenue with $123.0bn value in 2019. Over the last twelve months, however, mobile POS payments jumped by $14.8bn to hit $45.7bn in 2020.
While digital commerce transactions fell last year, they are now predicted to increase over $155bn in value – a $37bn jump in just four years. According to the Statista survey, the entire digital payments industry in the UK is forecast to double and hit a $366bn transaction value by 2024.
Adapting to Changing Payment Behaviours
As seen in the current numbers, market trends, and forecasts, merchants have also had to adapt their services to manage the impact of the COVID-19 pandemic. Payment methods that mainly cover exclusively in-store transactions have clearly been more affected than ecommerce methods. However, ecommerce shops have also been hit with an increase in chargebacks as transactions move online.
Merchants have had to find payment processors that support more payment options as point-of-sale (POS) acceptance continues to be hit hard. To make things more complicated, consumers are beginning to expect a greater variety and speed when it comes to making their payments online. To keep up, business owners have sought the assistance of high-risk processors that specialize in helping ecommerce merchants and understand the challenges they face.
Where to Find a High-Risk Processor
Why choose a high-risk processor? Many merchants that operate an ecommerce company are considered high-risk by traditional processors, due to the nature of the business and the high chargeback rates they often face. A high-risk processor will have experience in handling these challenges, offer industry-leading services and provide support and chargeback protection and prevention programs.
To find the best UK payment processors for digital payments, consider browsing the many reviews Best Payment Providers has to offer. You can compare of the best UK processors available, find out more about their services and stay up to date on the latest industry news. Our team can help you discover the payment provider that meets your needs and has the reputation your business deserves.