India has retained the top spot in the world with 25.5 billion real-time payment transactions, followed by China with 15.7 billion transactions. In 2020, the transaction volume share in India stood at 15.6 per cent and 22.9 per cent for instant payments and other electronic payments respectively, while paper-based payments had a considerable share of 61.4 per cent.
As per 'Prime-Time for Real Time', a global report tracking and analysing real-time payment volumes, growth and dynamics across 48 global markets by ACI Worldwide and GlobalData, this is poised to change by 2025 where the share of volume by instant payments and other electronic payments is expected to rise to 37.1 per cent and 34.6 per cent respectively, leaving the volume of paper-based transactions at 28.3 per cent. Furthermore, by 2024 the share of real-time payments volume in overall electronic transactions will exceed 50 per cent, according to the report.
The report observes that by the year 2025, digital payments in India would collectively account for 71.7 per cent of overall payments volume, leaving cash and cheques at just 28.3 per cent. Interestingly, the report points out that real-time payments transactions surged by 41 per cent globally in 2020 as Covid-19 pandemic accelerated the shift to digital payments.
China was followed by South Korea with 6 billion transactions and Thailand with 5.2 billion at the fourth position. This was followed by the UK with 2.8 billion transactions.
The report further states that as the pandemic continues to drive changes in consumer and business behaviors, banks, merchants and intermediaries across the payment ecosystem are responding rapidly, prioritising the shift to digital to protect current revenue streams and searching for new ones through a fully digitised customer experience. The report further states that in 2020, mobile wallet adoption rose to a high of 46 per cent in 2020, up from 40.6 per cent in 2019 and 18.9 per cent in 2018 respectively.
Countries such as Brazil, Mexico and Malaysia where many people historically relied on cash are now some of the fastest adopters of mobile wallets. “The pandemic has accelerated the adoption of digital payments with many first time users adopting digital payments and significant uplift by merchants. As the industry evolves, we expect to see increased adoption across different users and volume growth driven by mass adoption, recurring payments, transit payments as well as cross-border transactions,” said Kaushik Roy, Vice President and head of product management, Asia, Middle East and Africa, ACI Worldwide.
The report highlights that globally, real time payments were on a growth path and the total number of real-time transactions in 2020 were 70.3 billion, up 41 per cent from 50 billion in 2019. The real time share of global electronic transactions in 2020 was 9.8 per cent, up from 7.6 per cent in 2019. It is predicted to be 17.4 per cent by 2025.
The report also mentions that though there has been a steady rise in real-time payment transactions there has also been an increase in payments fraud. Though card-related fraud remained highest in terms of reported incidents from consumers globally, fraud incidents associated with real-time payments were on the rise from 2019 to 2020 as fraudsters tend to target new channels. The report highlights that the real-time payments scams that were on the rise include confidence tricks (12.5 per cent rising to 13.7 per cent), identity theft (6 per cent rising to 11.6 per cent) and digital wallet account hacks (4.4 per cent rising to 6.2 per cent).