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Intuit 2020 Report: The Future of Financial Services

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Fast Facts: Student Loans

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/   Spotlight

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/   Insights

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/   Insights

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What We’re Reading

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/   Spotlight

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Small Business: Perception vs. Reality

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/   Insights

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What We’re Reading: Thanksgiving Edition

November 22, 2012
/   Spotlight

Below are interesting stories the staff has been reading over the past week. What have you been reading? Let us know in the comments section below or Tweet @bankingdotcom. Mobile Thursday? Plans for Thanksgiving...

For all the talk around electronic payments becoming ubiquitous and the death of cash, there is still a long way to go before every single merchant accepts cards.

But this is changing fast as more businesses take the decision to enable consumers to make card payments.

The number of merchants that accept card payments will double from 46.6 million at the end of 2014 to 90.3 million by 2020, according to the Global Payment Cards Data and Forecasts to 2020 report from research and consulting firm RBR.

Not surprisingly, given the saturation in developed European and North America markets, the biggest growth can be expected from the Asia-Pacific region, where 42 per cent of all global outlets can be found.

In 2014, the number of merchant outlets rose 17 per cent globally, with Asia again leading the way. Here, card acceptance is filtering down from the large merchants in the big cities to smaller outlets and into the smaller towns and more remote regions.

The relatively untapped markets of India and China will be key for growth. “Large but as yet underdeveloped markets such as China and India provide significant potential for further growth, and the overall density of outlets is much lower than that of North America,” said RBR in the report.

Mirrors electronic payment growth

Card acceptance goes hand in glove with broader electronic payments, so it’s no surprise that the RBR report chimes with the findings of the 2015 World Payments Report, published last year by Capgemini and Royal Bank of Scotland.

This showed not only the global rise in non-cash payments – rising nearly nine per cent in 2014 to reach a total of 389.7 billion transactions – but also that Asia Pacific is where the main growth is being seen.

The report’s ‘Emerging Asia’ region experienced growth in non-cash payments of 21.6 per cent in 2013 and is expected to reach 27 per cent in 2014. China leads, with an increase in non-cash transactions of 37.7 per cent in 2013.

Visa and MasterCard still top, but for how long?

The RBR report notes that while Visa and MasterCard are still dominant – accepted at 78 per cent of merchants globally – it’s unclear how long they can sustain this market share as the bulk of future growth is coming in China, where they have a much smaller footprint of 29 per cent of merchants.

The rising star is China’s UnionPay, which is the fastest-growing scheme. It saw a 25 per cent rise in new outlets in 2014, with the bulk of these in its home market of China. However, UnionPay is arguably in a more fragile position in terms of its ability to maintain presence in various markets.

“UnionPay’s level of international acceptance is critically dependent on network-to-network agreements, most notably with Discover in the USA and JCB in Japan – any changes to these agreements, or the addition of any new agreements, would therefore have a major impact on the size of its overall network,” notes RBR.

None of this matters much to the consumer, though. Whether it’s Visa, MasterCard, Discover, American Express or UnionPay – the fact is that card acceptance is on an upward trajectory.


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James W. Gabberty

Gabberty is a professor of information systems at Pace University in New York City. An alumnus of the Massachusetts Institute of Technology and New York University Polytechnic Institute, he has served as an expert witness in telecommunication and information security at the federal and state levels and holds numerous certifications from SANS & ISACA.

Brad Strothkamp

Zachary Ehrlich

25-year-old writer, and as a native San Franciscan, I am unreasonably loyal to Bank of America, if only for their superhero-like origin story, involving the 1906 earthquake and Italian fruit vendors.

Marisa Mann

Marisa Mann brings over 15 years of experience in consulting and financial services industries to the Solstice team, working on large scale enterprise initiatives across many technologies, including specializing in the digital space – Internet and mobile. Mann is passionate about mobile and the endless possibilities for the enterprise, delivering business value through strong brand recognition and driving to excellence in the consumer experience. Prior to Solstice, Mann worked at JP Morgan Chase, Diamond Management and Technology Consultants, Washington Mutual, Inc, and Accenture.