Juniper Research is advising merchants to increase their support for digital wallets. The recommendation is based on a new study on eComerce Payments that suggests that the use of OEM Pay wallets like Google Pay and Apple Pay is set to explode in the next few years.
In raw numerical terms, Juniper believes that 30.7 billion transactions will be completed with some kind of OEM Pay wallet by 2026. That number represents more than a six-fold increase over the current number, which sits at 4.7 billion in 2022. Juniper attributes the anticipated growth to the shifting demands of consumers, who increasingly expect a streamlined and frictionless checkout experience when buying goods online.
OEM Pay wallets fit well within that ecosystem, giving people a convenient and secure way to complete digital payments. Juniper believes that OEM wallets will be popular with consumers who opt for Buy Now, Pay Later purchases, and that merchants that do not offer an OEM Pay option will end up losing business (and losing customers) to those that do.
According to Juniper, Western Europe will be the epicenter of the burgeoning OEM Payments movement. The volume of transactions in the region will jump 516 percent in the forecast period, with the increased awareness of security measures like biometrics and tokenization driving adoption rates and making people feel more comfortable with the technology. OEM Pay transaction volume is up 63 percent globally in 2022, though the growth in other parts of the world will lag behind that of Western Europe, largely because the uptake for mobile contactless payment technologies has not been as high in other regions.
Juniper has previously predicted that more than $3 trillion worth of transactions will be cleared with biometrics by 2025. The firm also reported $2.5 trillion worth of contactless card transactions in 2021.