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Over half the world’s population will use mobile wallets by 2025, says Boku study

Over half the world’s population will use mobile wallets by 2025, says Boku study

More than one in two people will use a mobile wallet by 2025, as cash is increasingly displaced, finds a study from mobile payments company, Boku. This equates to an increase of 2.7 to 4.8 billion wallets in use globally in the next four years.

Leading the way in this transition is Southeast Asia, with a 25.5% compound annual growth rate (CAGR) and an expected overall growth of 311% in the next five years. The rise in e-commerce, and the dominance of super-apps like Grab and Gojek – particularly in markets such as the Philippines and Indonesia – are just some of the drivers of wallet adoption in this region.

Following closely behind – in areas where wallets are offering access to financial services for the underbanked – is Latin America, and Africa and the Middle East. These two regions are due to expand their usage of mobile wallets by 166% and 147%, respectively, by 2025. In Africa and the Middle East, adoption is being catalysed by the increasing usage of mobile money services, such as M-Pesa, which are offering improved access to e-commerce.

In Western Europe and North America, however, wallet uptake is moving more slowly – at 65% and 50% by 2025, respectively. This is a result of high levels of card penetration and contactless usage at physical points of sale. Nevertheless, markets such as the UK are seeing a spike in card-based mobile wallets, due to the adoption of contactless spurred on by the pandemic. Thanks to shifts like this, Boku predicts that three quarters of Europeans will be using a digital wallet by 2025.

“We are witnessing a paradigm shift in payments driven by mobile wallets,” says Jon Prideaux, CEO at Boku. “Mobile wallets have lowered the barrier to making digital payments and ushered billions of new consumers into e-commerce. These consumers are not in North America or Western Europe, they are in emerging markets, and while they don’t have credit cards, they overwhelmingly have mobile wallets. For global merchants, mobile payment acceptance is not about accepting one type of mobile wallet or another, but ensuring that consumers in every market will have the required selection on payment types in order to monetize transactions.”

Boku’s report follows an eventful week for the mobile wallets sector in Europe, with the merger of Vipps, MobilePay and Pivo as they look to compete against the likes of Alipay, Apple and Google.

Comments: (3)

Melvin Haskins
Melvin Haskins - Haston International Limited - 08 July, 2021, 15:07Be the first to give this comment the thumbs up 0 likes

I do not believe the headline that half of the world will be using mobile wallets by 2025. That means that 3,900,000,000 will be using them in four years time. How about some accurate statistics to back this up.

Jeremy Light
Jeremy Light - Fourdotzero - London 08 July, 2021, 15:551 like 1 like

The headline is very believable - examples today include Alipay 870m mobile users, Wechat 800m, Paytm 450m, Apple Pay 383m, plus many other wallets with wide local adoption such as Bkash in Bangladesh in addition to those mentioned above.

There are many different types of mobile wallet ranging from dematerialised card containers such as Apple Pay to stored e-money accounts such as PayPal mobile, to telco wallets to crypto wallets.

Although mobile wallets are less obvious in Europe it is easy to see how Google Pay, Apple Pay etc will supersede plastic for card transactions; but look to Asia and Latin America for how the future will look with mass adoption of mobile payments.

Ketharaman Swaminathan
Ketharaman Swaminathan - GTM360 Marketing Solutions - Pune 09 July, 2021, 15:09Be the first to give this comment the thumbs up 0 likes

The article is silent about UPI-based mobile wallets / mobile payment apps in India. While we keep hearing about UPI payment volume and value, I can't find any user count figures handily. But, between leading apps PhonePe, Google Pay, et al, I wouldn't be surprised if there are 200M UPI users in India. 

But there's a challenge in using these stats to make inferences about current or future users: Overlap in usage. Many AliPay users also have WeChat Pay. Many PayTM users also have PhonePe and Google Pay. It's very difficult to say how many unique mobile payment users are there. 

Besides, many / most mobile payment users also use cash in all countries (except perhaps China, Sweden), so it's difficult to substantiate the extent of cash displacement by mobile payment apps with high level stats.