Credit cards were the leading online payment method among Australians in 2021, accounting for one-third (33%) of e-commerce transaction values; however, a new report expects digital wallets to overtake credit cards to become the leading payment method in Australia by 2025.
The 2022 Global Payments Report by Worldpay from FIS also confirmed the popularity of buy now, pay later (BNPL) and its share of e-commerce transaction value is expected to increase from 11% in 2021 to a projected 14% in Australia in 2025.
“We’re predicting New Zealand to be at a 17% share of online payments and Australia at 14% by 2025. When you compare that with the global average share of 5% and Asia at 2%, then this part of the world is really outpacing other markets globally,” Worldpay Merchant Solutions at FIS general manager for APAC, Phil Pomford said.
Meanwhile, cash is in steep decline, and Australia is expected to have the lowest cash share in APAC in 2025 with cash accounting only 2% of POS transaction value.
Debit cards (41%) and credit cards (35%) were the leading POS payment methods in 2021 and are projected to retain these leading positions through 2025.
As Australian consumers shift away from cash at POS, mobile wallets – the fastest growing offline payment method – are capturing consumer loyalty and are on track to account for 16% of in-store transaction value by 2025.
More broadly, Australia’s e-commerce market is set to grow by more than half (51%) between 2021 and 2025 to US$70.7 billion (A$98.37 billion) in transaction value.