Karsten Wenzlaff, Advisor
August 26th, 2025
Karsten Wenzlaff is a Crowdfunding and Fintech Expert from Germany. He is Secretary-General of Digit[...]
2024 Global Payments Growth, Trends, and Fintech’s Edge
Report | Oct 24, 2024
Image: Global Payments in 2024 (McKinsey & Company)
Insights from McKinsey's 2024 Global Payments report highlights fintech opportunities, evolving trends and challenges
The 2024 McKinsey Global Payments Report (17 page PDF) shows that the way users are interacting with payment systems globally is becoming easier but the systems themselves are getting more complicated. This post looks at the trends and opportunities for fintechs (and challenges) that are reported on.
Top Line
- In 2023 the payments industry processed 3.4 trillion global transactions, with a total value of $1.8 quadrillion.
- Global payments generated $2.4 trillion in revenue in 2023, growing 7% annually from 2018 to 2023. Growth is expected to slow to 5% per year from 2023 to 2028, due to lower interest rates and a shift to less profitable payment methods like account-to-account transfers.
See: Canada’s Retail Payments Boom: $11.9 Trillion Growing Fast
- Over the next five years revenues are forecasted to grow by $700 billion, reaching $3.1 trillion by 2028. This will represent approximately 35% of the total banking revenue.
Image: Global payment revenue 2013-2028 (McKinsey)
Insights and Trends (for the Next 5 Years)
- The use of Cash has dropped to 80% of 2019 levels and continues to fall by 4% each year. Countries like India and Brazil are moving quickly towards digital payments but cash usage is declining slower in countries where cards are still prevalent like in the United States. Cash still makes up $26 trillion in global payments so there is still fintech opportunity to capture the digital transition towards full adoption.
- Instant payment systems are moving across major markets and working to replace cash and outdated checks. As an example, in the European Union instant payment transactions are expected to jump from 3 billion to 30 billion by 2028, growing 50% annually.
- Some countries like India, Brazil, and Estonia have implemented strong public digital payment infrastructures (DPI) making digital payments more accessible. This trend is expected to spread further especially in emerging markets like Indonesia and Nigeria who are looking to boost digital payment growth.
See: Goldman Sachs Funds Blockchain Payments Firm
- E-commerce Payment platforms like Shopify and marketplaces like Amazon now handle 30% of global consumer transactions. This trend is especially strong with small to mid-sized businesses (SMEs) where integrated payment solutions are popular. This is putting pressure on banks and other global tech players who are launching their own small business payment tools like Fiserv’s Clover.
- Business clients now expect the same slick payment experiences that consumers get and transaction banking is evolving to meet those needs. Banks like Goldman Sachs and Royal Bank of Canada are investing significantly in transaction banking as they look to compete with specialized B2B payment providers and digital first challenger banks.
- Despite the public and commercial privacy concerns with CBDCs, over 90% of central banks are working on or testing CBDCs. Although it seem like the initial CBDC excitement has worn off, central banks are expecting CBDCs to establish new standards and provide real alternatives to stablecoins.
Implications and Opportunities for Fintechs
- With the rise of instant payments Fintechs can stand out by offering easy to use, mobile-friendly cross-border payment options and improving treasury services with real-time data, not to mention quick payments for gig workers.
- Payment card fraud losses are expected to reach $400 billion over the next decade. Fintechs can improve anti-money laundering and fraud detection systems, and clients can offer that to their customers as a competitive advantage.
See: API Magic: Empowering Payment Services Providers and Fintech Innovators to Scale
- With the growth of digital public infrastructure in some countries like emerging markets, fintechs can develop services that integrate seamlessly with government approved national ID systems, digital wallets, and other payment channels. India's UPI is a good example to review - see UPI One World wallet service
- 23% of SMEs in the UK prefer to use non-bank providers for cross-border payments. Fintechs can develop customized (and personalized) payment solutions that optimize international transactions. See companies like Loop here in Canada who recently raised $6.4 million CAD for a SME-focused global finance platform.
- Payment infrastructure needs to be reliable and operate around the clock 24/7 while handling large volumes globally. Fintechs that build scalable, cloud-based systems will have an advantage over traditional setups that are slower to adapt.
Outlook
Regulatory changes involving interchange fees and consumer protections will impact how global payments evolve. Fintechs need to stay on top of these changes for compliance and earn customer trust. Traditional banks like JPMorgan and RBC are investing big time in updating their digital payment offerings to compete with fintechs. Companies that make strategic investments in technology, partnerships, and maintain compliant will have an edge in an increasingly more complicated and growing global payment sector.
The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, artificial intelligence, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
 |  |  |
|---|---|---|
 |  |  |
Leave a Reply