Domestic money transfer to jump nearly 50%, Juniper forecasts

Dive Brief:

Domestic money transfer payments worldwide will surge nearly 50% between this year and 2026, from 207 billion payments to 300 billion payments, research firm Juniper Research predicted in a report released today.
The top three countries for such payments, including China, India and the U.S., will account for about 74% of the total in 2026, the research firm said in a white paper highlighting key points of the report.
The “Far East and China” will account for the largest portion of the payments, by far, with “Africa and the Middle East” accounting for the second-largest amount and North America having the third-largest amount.

Dive Insight:

Domestic digital payments have been rising with support from peer-to-peer tools, such as PayPal’s Venmo and WeChat Pay in China plus a proliferation of “super apps” for sending money to friends and paying bills. That activity was supercharged during the COVID-19 pandemic, when people worldwide hunkered down at home to avoid the spread of the deadly virus turned to digital alternatives and avoided the use of cash.

Three payments trends that will keep pushing the phenomenon forward are: stablecoins, or digital currencies pegged to fiat currencies, or similar blockchain-based money transfer options; the advance of central bank digital currencies that are being used, piloted or explored in a number of countries (the U.S. is in an exploratory phase); and the development of applications for services that make payments a key function.

Super apps, which are typically phone-based functions and provide multiple services in one software application “are driving digitisation of previously cash-based payments, by including messaging and access to other services alongside payments,” the U.K.-based Juniper’s white paper issued Monday said. (Juniper declines to make its full reports available for media.)

Still, creating a unique service that has winning appeal for consumers won’t be easy in a marketplace where legacy payments companies and fintechs alike are developing many new offerings. “Differentiation is a key challenge for money transfer apps, particularly given the highly competitive market landscape,” the report said.