The latest insights, observations, and opinions on the global business services industry based on crowdsourced insights with industry experts.
Payment Processors - Channel Intelligence Report - 8 September 2021
The latest insights, observations, and opinions on the global payment processor industry based on crowdsourced insights with industry experts.
Transaction Volumes Soar 28% YOY in Q3-2021; Modern PSPs Take Centre Stage with Checkout.com, Adyen and Stripe Gaining; Card Payment Share Remains Flat at 63% as E-wallets Increase and Cash Payments Decline; Innovation Levels Decline QoQ Across the Payment Industry
Transaction Volumes Soar 28% YOY Over the Last 90-days
- Across the sources we interviewed over the last 90 days, on average merchants were reporting a 12% increase in their transaction volumes. Most of the merchants that had seen a significant increase in transaction volumes pointed to the growth of e-commerce as the core reason behind their increasing volumes as well as internal company growth. Checkout.com and Stripe were the individual PSPs that had seen the highest levels of volumes growth.
Adyen, Stripe and Checkout.com Take Centre Stage as Modern PSPs Prevail Among Industry Experts
The majority of Payment Specialists interviewed in the last 90-days cited a preference for PSPs that can offer both a modern platform as well as a strong technology stack and documentation. Stripe, Checkout.com and Adyen were commonly referenced as the three PSPs leading the market in terms of technology and innovation, making them more popular among merchants.
38% of Payment Specialists Add a New Payment Processor
- Across the merchants interviewed over the last 90-days, 38% had added a new PSP. The majority of these merchants had added a local PSP to process volumes in specific countries. This was mostly seen in emerging markets, such as Latin America or Asia, where global PSPs have limited processing capabilities.
Checkout.com and PayPal Expected to Have Higher Forward Volume Shares Whereas Worldline Anticipated to Lose Out
- Checkout.com and PayPal had the highest percentage of respondents reporting higher expected forward supplier shares. 67% of the merchants using Checkout.com expect their share of volumes to increase over the next 6-months and 45% of those offering PayPal expect their forward share to increase. On the other hand, 80% of the merchants using Worldline as a core PSP expect their forward volume share to decrease over the next 6-months.
Cards Retain Approximately 63% of the Payment Share as E-Wallets and APMs Increase and Cash Payments Decline
- Across the last 90 days, merchants reported an average card payment share of 63%, in-line with trends seen over the last year. E-wallets such as Apple Pay, Google Pay and PayPal were gaining the most share, as well as buy now, pay later schemes such as Klarna. Cash payments had declined by approximately 10% globally when compared to pre-pandemic levels.
Pricing, Technology and Authorisation Rates Most Frequently Cited Factors When Selecting a Payment Supplier
- Payment Specialists flagged pricing, technology and authorisation rates as the three most important factors when selecting a PSP. Pricing was cited by 62% of merchants as a core criterion in their decision-making process. This was closely followed by technology and authorisation rates, referenced by 51% and 49% of respondents, respectively.
Checkout.com Receives the Highest Satisfaction Rating with 4.5 out of 5 as Nexi Fails to Impress Payment Specialists
- Merchants interviewed in the last 90-days reported an average satisfaction rating of 3.8 out of 5 for their chosen PSP. Checkout.com received the highest satisfaction rating with merchants providing a rating of 4.5 out of 5. Nexi received the worst average satisfaction rating with a 2.7 out of 5.
Innovation Levels Decline QoQ Across the Payment Industry as Only 18% of Respondents See an Increase in Innovation Levels
- Payment Specialists interviewed in the last 90-days generally reported mixed and broadly unchanged YOY innovation levels with only 18% of respondents seeing an increase in product innovation levels. This represents a significant decrease in QoQ innovation levels when compared to the prior 90-day period where 48% of merchants reported seeing higher innovation levels.
64% of Merchants Believe Their PSP is Gaining Market Share with Stripe, Checkout.com and PayPal Leading the Race
- 64% of Payment Specialists interviewed in the last 90-days reported seeing an increase in their PSP’s market share YOY. 86% of the respondents using Stripe as a core PSP believe that Stripe is gaining market share. This was closely followed by Checkout.com with 83% and PayPal with 73% of Payment Specialists noting that they are gaining market share. Merchants were also positive about Adyen, with 69% of merchants using Adyen as a core PSP stating that Adyen is gaining market share.
Network International and Checkout.com Dominate Payment Space in the United Arab Emirates Despite Adyen’s New Offices
- Despite Adyen recently opening offices in Dubai, merchants noted that payments in the United Arab Emirates are currently dominated by Checkout.com and Network International. Checkout.com have a stronghold on online processing volumes and Network International offers exceptionally cheap rates on acquiring and POS processing services. Merchants said that Adyen does not yet offer a viable processing solution in the Middle East, but will likely become a competitor in the near future.
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Woozle Research specialises in crowdsourcing subject-matter expertise by conducting thousands of interviews every month with active industry professionals to help investors get a deeper insight into their investments to generate greater returns. All our interactions are anonymous and we never disclose our sources.