Digital payments – The next revolution in payments gathers pace …

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The love affair between consumers and their mobile phones is leading to explosive growth in new digital payments across Europe. More and more consumers are shopping across borders online and using mobile in-app and in-store for purchases, while innovative retailers increasingly offer omnichannel payment services, including digital and mobile transactions. E-commerce in total rose by 10.2% across Europe in 2018-2019 – according to the latest research from Digital & Payment Cards Yearbooks.

Digital & Card Payments Yearbook 2018-19

In 2019, cards (56.61%), credit transfers (23.40%) and direct debits (18.27%) were the leading cashless payment methods by volume across the 28 EU member states. Member states benefit from a common legal framework for payment services, PSD/PSD2, and the SEPA payment instruments SCT and SDD.

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Enabled by contactless technologies (e.g. NFC, HCE NFC, QR, BLE) and the use of tablets and mobile devices (online, in-app, in-store), the evolution of digital payments continued in 2018-2019:

  • Digital challengers and leading European banks are combining mobile banking apps with cardless in-app payments, P2P money transfers, and mobile HCE NFC payments on cards. The number of UK banks offering Apple Pay, for example, tripled between 2018 and 2019.
  • The card schemes are pushing 3D-Secure 2.0 while more payment initiation service providers (PISPs) offer cardless IBAN-based digital payment services.
  • In October 2019, American Express, Discover, Mastercard and VISA announced the rollout of click-to-pay, an interoperable one-click checkout button at e-commerce sites, by early 2020. Based on the new EMV Secure Remote Commerce (SRC) industry standard, the initial focus will be on converting existing MasterPass and VISA Checkout merchants to Click-to-Pay.
  • The rollout of HCE NFC technology combined with tokenization security will hide static card data and bank account data in the cloud. Supported by the card schemes, the ‘Giant Pays’ PayPal, Apple, Samsung and Google are adopting this technology approach.
  • Immediate payments like Faster Payments in the UK and instant payments (SCTINST) gained traction through 2019. By late 2019, the UK’s Faster Payments had 32 participants, while more than half of Europe’s banks were active in SCTINST. Sweden’s SWISH grew transaction numbers by 30% in 2018-2019 and hit a new record of 200 billion SEK in transaction value.
  • Strong Customer Authentication will be a reality for all European banks by the end of 2020, with the UK and Poland receiving dispensation until Q1 2021. Individual country profiles in PCM’s Digital and Card Payment Yearbooks give background for the development of digital payments in 43 countries, including cardless bank payment services and mobile app initiatives.
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PCM’s Digital & Card Payment Yearbooks 2019-2020 are the most comprehensive and granular data source anywhere in the industry, with up-to-date, in-depth reviews of the payment services and card issuing, acquiring, and processing businesses in 43 countries, plus national and supra-national regulation, new technologies, and information on leading individual institutions, payment service companies, and national schemes. Overviews for Europe and Eurasia are also available.

Recognised through the payments industry as the most authoritative source of cards and payments business information for the European and Eurasian payment markets, the reports comprise two volumes: Volume 1 covers payments statistics for 33 European countries and Volume 2 contains payments statistics for 10 Eurasian countries.

The European Digital and Card Payments Yearbook 2019-20 and the Eurasian Digital and Card Payments Yearbook 2019-20 are available to purchase as complete volumes or as individual country profiles.