Jeff is headed to the airport to fly to a business trip. Along the way, he grabs a coffee — and pays for it with his e-wallet, which automatically gives him credit for the purchase on his loyalty card. At the airport, Jeff uses the boarding pass that’s saved in his e-wallet to access the security line and board the plane. He arrives at his hotel, where he’s a member of the frequent guest program. A text message already gave him his room number, and he unlocks the door with his digital wallet. He hasn’t spent any cash all day.
Digital technologies such as e-wallets and Peer-to-Peer (P2P) lending are having a huge impact on the way we buy and sell, with an estimated USD 1 Trillion expected to go through mobile payments by 2020. E-Wallets and P2P lending are just two examples of the growing influence of FinTech.
A WNS DecisionPointTM report assesses the impact and growth of e-wallets and P2P along with other game-changers in the FinTech industry such as crowdfunding, crowdinvesting, challenger banks and blockchain. In this blog, we look at e-wallets and P2P lending.
E-Wallets Growing Globally
PayPal. AliPay. ApplePay. Oppo. Paytm. These are some of the key players in the e-wallets segment. E-wallets have clearly become a global phenomenon — and they keep getting bigger and more relevant, with 80 percent of millennials shopping and paying bills online with a mobile device. The following data across geographies indicate a positive outlook for e-wallets:
Europe: The British are leading adoption of mobile payment, with 74 percent of that population using a mobile device to make payments and manage their finances
China: In 2016, mobile payment activity in China was nearly 50 times greater than in the U.S., and the number of Chinese mobile payments is expected to multiply by 7.4 times between 2015 and 2019
Sweden: It’s estimated that by 2020, cash will be used for just 0.5 percent of all payments
P2P Lending Attracts More Users
P2P lending is becoming firmly entrenched as a legitimate payment method that represents all of the key features inherent to a FinTech solution. Analysts forecast the P2P market will be worth USD 897 Billion by 2024.
Since P2P lending is completely digital, lenders can adapt quickly to market changes — and borrowers can get decisions fast. This digital foundation is also less costly to maintain compared to legacy banks. Finally, P2P lending has a superior reputation compared to traditional financing because investors understand that they’re funding individuals and not a bank’s balance sheet.
FinTech is very much still maturing, but as the WNS DecisionPointTM report makes clear, it’s tough to argue with the huge impact it has had in a very short time. This growing industry is changing the way people spend, lend and borrow money, get investment advice, manage investments, and handle payments across the globe. And due to their ubiquitous nature, e-wallets and P2P lending may be the FinTech technologies with the greatest potential impact on both businesses and consumers.
Click here to read the detailed report