Electronic payments on the rise: Capgemini

With consumers showing preference for cashless transactions, electronic, mobile and debit card payments are becoming increasingly popular. Globally, the volume of non-cash payments remains concentrated in developed markets, with North America, Europe and Mature Asia-Pacific together accounting for 79.5%. However, the BRIC block is diverging, with Russia and China boosting payment volume increases of more than 30%, while Brazil has become the second-largest payment country in the world, after the US. India's payment volume grew at 10% and has great potential for future growth, it says.

The report confirms the resilience of payment volumes, as global non-cash payments volumes grew by 7.1 percent in 2010, reaching 283 billion, although early 2011 indications show an additional 8.2% growth. In 2010, payment volumes in developing markets grew at a much faster rate (16.9%).

As more consumers embrace electronic, mobile and debit card payments, industry innovation will continue to focus heavily on these payment methods. According to industry analysts, there were an estimated 28.3 billion electronic and mobile payment transactions globally in 2011, and in 2010 more than one in three non-cash payments globally was made using a debit card, up 15.2%, according to the report. But with only 2.1% of all mobile users making m-payments, the potential for additional growth is still huge, with mobile payments set to reach 17 billion by 2013 and e-payments 31.4 billion by 2013.

"Debit card transactions continue to take market share from other types of payment methods because they easily allow people to bypass the use of cash," said Kevin Brown, Global Head, Transaction Services Product, International Banking, RBS. "As more and more consumers move to mobile and other electronic payments, we'll continue to see the exponential growth of innovative payment solutions."

The report also shows that the real payment innovators are organisations with a granular understanding of the needs of their target customer segments, as well as their own capability to innovate. The WPR cites Japanese telecommunications organisation NTT DOCOMO, which has succeeded in quickly growing to create a critical mass of 35 million registered users (or half the market) with its "Mobile Wallet". Mobile Wallet, or Osaifu-Keitai in Japanese (as known locally), is a proximity payments instrument enabled through compliant mobile phones, with services going beyond just NFC payments and including: electronic money, identity card, loyalty card, public transport ticketing (includes railways, buses, and airplanes), and credit card. By using open standards, building on existing payment instruments (such as credit cards) and considering loyalty programs and CRM services for merchants, the program has proven successful over the past eight years.