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Payment Security Market Size, Share & Industry Analysis, By Solution (Tokenization, Encryption, and Fraud and Prevention), By Enterprise Type (Small & Medium Size Enterprise and Large Enterprise), By Industry (BFSI, Retail, Healthcare, IT & Telecom, Travel & Hospitality, Others (Media & Entertainment, and Others)), and Regional Forecast, 2024-2032

Last Updated: July 01, 2024 | Format: PDF | Report ID: FBI103748

 

KEY MARKET INSIGHTS

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The global payment security market size was valued at USD 26.09 billion in 2023. The market is projected to grow from USD 30.08 billion in 2024 to USD 92.12 billion by 2032, exhibiting a CAGR of 15.0% during the forecast period.


Payment security involves the process businesses adopt to visualize and gain insights based on correlation, hidden patterns, the market’s changing trends, and more. For instance, in May 2022, Transaction Network Services (TNS) unveiled its recent Point of Sale (POS) terminals at PACE in Adelaide, Australia, part of the TNS accepted product collection for the parking industry. These POS devices provide a secure payment experience for consumers who want to pay by card, digital, or contactless wallet in various areas such as retail stores, parking lots, electric vehicle charging, and vending machines.


In the scope, we have considered payment security solutions provided by key players such as Paypal Holdings, Inc., Thales, Cybersource, PayU, and Tokenex, among others.


The COVID-19 pandemic surged frauds, cyberattacks, ransomware attacks, and money laundering, among others. Since COVID-19 hit the world in 2020, there has been an exponential increase in digital payment fraud owing to the increasing adoption of this technology.


With the increase in online digital payment platforms, new opportunities are emerging for fraudsters to execute cyber-attacks. This will increase the demand for payment security for online digital payments. Owing to this, an unexpected spike is observed in these solutions in developing nations. This will likely increase mobile payment transactions and boost the adoption of these solutions globally.


Payment Security Market Trends


Increasing Awareness of Contactless Payments to Aid Market Growth


Technology is transforming and touching every aspect of our lives and has compressed how we shop and pay. There has been a significant shift to e-commerce and a rise in digital payments. Further, the number of users adopting contactless payments has increased in the last five years to meet growing consumer demand. From 1.2 million in 2015 to now, there have been over 8 million users. Thus, innovative payment platforms are driving the digital payments revolution further.


Despite the prolonged closure of many stores throughout various lockdowns to inhibit the extent of COVID-19, the significance of contactless payments increased by 7% in 2020 as compared to 2019. For instance,



  • According to the U.K. Finance Data 2020, the use of contactless payments increased by 29% in the U.K. grocery stores.

  • According to RTI research, 30% of consumers have started utilizing contactless payment methods, such as smartphones, NFC cards, and wearables, since the outbreak of COVID-19. 70% of them said they would continue to use this contactless payment method after the pandemic is over.

  • According to MasterCard Contactless Payments Data, gas stations, eateries, and grocery stores are the merchant sectors that have led the implementation of contactless payments in the U.S. These sectors have developed contactless payment usage between 2020 and 2023, making up most contactless transactions in the U.S.


Thus, the above factors in contactless payments are considered trending factors in the market.


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Payment Security Market Growth Factors


Increasing Frequency of Data Breaches and Advanced Technology in Payment Security to Drive Market Growth


One of the main factors driving the growth of the security industry is the growing frequency of data breaches. As the number of data breaches increases, money is also lost. Thus, as data breaches increase, the demand for solutions increases. For instance,



  • In August 2020, Juspay, a payment service provider that processes transactions for online giants, such as Swiggy and Amazon, admitted to a data breach. The breach compromised approximately 3.5 million records containing masked card numbers and personal information.


Additionally, the adoption of advanced technologies, such as 5G, Big Data, and the cloud, by key market players is expected to drive the global market. These major players are partnering with other market players to add advanced technologies to their security solutions portfolio. For instance,



  • In July 2022, TokenEx, a cloud tokenization and payment optimization provider, partnered with Visa, a global provider of digital payments, to become an authorized cloud-based network tokenization partner for Visa. As part of its collaboration with Visa, TokenEx has chosen Token ID, which supports regional payment systems, banks, merchants, clearinghouses, and other payment participants.


RESTRAINING FACTORS


Security Concerns and Lack of Skilled Professionals to Impede Market Growth


Security concerns include phishing scams, hacking tools, unauthorized access, and exposed mobile wallets, which can risk users' data and information. It is also challenging to determine the kind and level of user data protection.


Also, hackers may steal consumer data, such as debit and credit card passwords, UPI IDs, net banking passwords, and many more. Phishing scams have existed for a long period, but as digital technologies are growing continuously, mobile device scams have experienced cybercrime progress with new intelligence and speed. Other issues that can put security in danger include weak passwords, human errors, usage of public WIFI, and many more.


Companies still face data security concerns and a lack of skilled professionals, restraining market growth. For instance,



  • According to an industry survey, U.S. consumers stated that mobile payments were “poorly protected” (38%) compared to prepaid (28%), debit (22%), and credit cards (9%).


Payment Security Market Segmentation Analysis


By Solution Analysis


Fraud and Prevention Segment to Dominate Owing to Rising Concerns Regarding Payment Fraud


Based on the solution, the global market is segmented into tokenization, encryption, and fraud and prevention.


Among these solutions, the fraud and prevention segment dominated the global market in 2023. The fraud and prevention segment is estimated to witness high growth during the forecast period. Payment fraud has also increased in recent years as sales via digital channels have reached new heights. Also, e-commerce industries use electronic transactions to charge users for services or products. The rise in the amount of electronic transactions has also resulted in the growth of fraudulent activities.



  • According to research by Outseer and Aite-Novarica Group, payments through digital channels increased to USD 4.2 trillion in 2020. Unfortunately, scammers are taking full advantage of this change.


Therefore, increasing payment fraud surges the demand for fraud and prevention solutions.


By Enterprise Type Analysis


Large Enterprise to Lead Owing to the Deployment of Advanced Solutions for Security Business Extension


The market is bifurcated by organization size into SME and large enterprises.


The large enterprise segment held the highest market share in 2023. Large enterprises comprise a huge volume of financial data and tend to be the prominent targets for cyber attackers. Hence, they also require layered security, proper employee training, testing solutions on a regular basis, and enhanced security measures. Due to such factors, large enterprises accounted for the highest share of the market in 2023.  


The SME segment is predicted to be the fastest-growing in the coming years. Due to increased payment fraud among SMEs, the demand for this security is growing. Security solutions are gaining traction among SMEs, as around 95% of credit card breaches come from SMEs.


By Industry Analysis


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Retail Sector to Dominate Attributable to Increased Online Payment Application Usage


Based on industry, the global market is divided into IT & Telecom, healthcare, BFSI, retail, travel & hospitality, and others (media & entertainment and others).


Among these, the retail segment dominated the market in 2021 and is estimated to grow with the highest CAGR during the forecast period.


The adoption of mobile payments in retail, especially in the e-commerce sector, is increasing due to government support, smartphone penetration, and online application usage. The promise of a better shopping experience will likely increase the demand for security solutions.


REGIONAL INSIGHTS


Geographically, the market is studied across North America, Europe, Asia Pacific, South America, and the Middle East & Africa.


North America Payment Security Market Size, 2023 (USD Billion)

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North America dominated with the highest global payment security market share in 2021. As real-time payments in North America are increasing rapidly, with significant year-over-year growth, there has been an increase in the number of payment frauds, and thus the demand for security solutions is increasing.


In North America, the penetration of digital payments reached 78% in 2020 as more than half of consumers shifted from in-store shopping to online shopping due to the pandemic. This has led to an increase in digital payment transactions, which has increased the risk of payment fraud. 


Additionally, in North America, leading players in the mobile payment industry, including Samsung, Apple, Inc. and others are focusing on introducing advanced technology-enabled mobile payment services built on these security solutions. 


The Asia Pacific region is anticipated to grow with a remarkable CAGR during the forecast period. The rising adoption of online digital payment among consumers in Asia Pacific aids market growth. For instance, around 60% of the APAC population is shifting to online digital payment options. Digital payments are increasing at over 30% per year, according to Kaspersky’s Digital Payments report. Further, the rapid proliferation and adoption of digital payments across several industries, such as retail, hospitality, and others, are surging the demand for payment security. According to Kaspersky’s Digital Payments Report in 2021, more than 46.0%, which is 1.8 billion people of the Asia Pacific region’s online population use an e-wallet regularly. This region uses several online platforms such as Kakao, Paytm, Grab, Line, Gojek, Apple Pay, Stocard, and Samsung Pay.


Further, several leading European players are expanding and developing security solutions to remain competitive. The increased use of contactless payments is also driving the European market. For instance, according to Elavon's survey, around 48% of people in the U.K. said they have started using contactless payment methods or are using them more frequently due to the pandemic. For example, Aldi, a significant supermarket chain in the region, is testing an app that allows shoppers to pay with automated checkout. The overall use of digital payments in Europe is estimated to grow by 70% between 2020 and 2025.


The payment security market growth in the Middle East and South America is due to the increasing demand for advanced security solutions systems to detect and identify cyber-attacks during online payments and transactions. The adoption of mobile payment services, including online payment, mobile banking, mobile wallet transactions, USSD/STK, and SMS has significantly boosted the possibility of occurrences of cyber fraud frequently. To deal with the rising fraud incidents, key market players in the industry are focusing on developing mobile banking applications based on advanced payment security solutions.


List of Key Companies in Payment Security Market


Strategic Acquisition to Boost the Market Expansion of Key Players


Leading companies offer payment security solutions across all businesses. Key market players are creating new solutions, updating tools and technologies, and expanding their scope to enhance their technological capabilities. Key players focus on increasing their market share and customer reach through strategic acquisitions. For instance,


List of Key Companies Profiled:



KEY INDUSTRY DEVELOPMENTS:



  • November 2024: Mastercard announced the launch of Biometric Payments in collaboration with NEC. The collaboration combines the facial recognition of NEC and the liveness verification mechanism with the payment operations of Mastercard. The new technology’s advantages for merchants comprise added security, shorter lines, and more hygienic conditions while providing an enhanced, engaging relationship with customers.

  • March 2024: Federal Bank, in collaboration with NPCI, announced the launch of Flash Pay. The RuPay smart key chain allows contactless and comprises enhanced security measures, including PIN authentication, ensuring intensified security for higher-amount purchases.

  • February 2024: Wibmo, a PayU firm, announced a collaboration with GUPSHUP, a conversation cloud platform. With the collaboration, the firm uses the conversational cloud platform Gupshup to provide international users with the capability to deliver transactions through WhatsApp. Moreover, Indian issuers can effortlessly send OTPs through WhatsApp to international clients, giving a cost-effective substitute to SMS, predominantly for numerous transactions within a 24-hour timeline without compromising on security.

  • January 2024: Ingenico announced a partnership with Cybersource to create a global unified commerce solution for usage across Asia Pacific, prominently followed by different regions. The collaboration incorporates the AXIUM application established by Ingenico on Cybersource's open-source payment platform.

  • August 2022: Bluefin partnered with Etix for Payment Processing and PCI-Validated Point-to-Point Encryption. Etix is a global ticketing service provider for the sports, entertainment, and travel industries and has a presence in 40 countries.

  • July 2022: Bluefin, a tokenization and encryption technology provider that secures payments and sensitive data, partnered with healthcare payment software provider Waystar to provide advanced payment security for healthcare payments. Additionally, the partnership offers Bluefin's PCI-validated point-to-point encryption solution and payment gateway via Waystar's software.

  • February 2022: Outseer has taken a strategic development step with Outseer Emerging Payments. The announcement marks Outseer's first expansion beyond Outseer 3D Secure, the payment authentication service, enabling growth and customer value beyond traditional card-not-present (CNP) transactions.


REPORT COVERAGE


An Infographic Representation of Payment Security market

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The research report includes prominent areas across the globe to provide a better understanding of the industry. Furthermore, it provides insights into the most recent industry and market trends, as well as payment security market analysis of technologies adopted quickly on a global scale. It also emphasizes some of the growth-stimulating restrictions and elements, allowing the reader to obtain a thorough understanding of the industry.


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REPORT SCOPE & SEGMENTATION










































ATTRIBUTE



DETAILS



Study Period



2019-2032



Base Year



2023



Estimated Year



2024



Forecast Period



2024-2032



Historical Period



2019-2022



Growth Rate



CAGR of 15.0% from 2024 to 2032



Unit



Value (USD)



Segmentation



By Solution



  • Tokenization

  • Encryption

  • Fraud and Prevention


By Enterprise Type



  • Small & Medium Size Enterprise

  • Large Enterprise


By Industry



  • BFSI

  • Retail

  • Healthcare

  • IT & Telecom

  • Travel & Hospitality

  • Others (Media & Entertainment and Others)


By Region



  • North America (By Solution, Enterprise Type, Industry, and Country)

    • U.S.

    • Canada

    • Mexico



  • South America (By Solution, Enterprise Type, Industry, and Country)

    • Brazil

    • Argentina

    • Rest of South America



  • Europe (By Solution, Enterprise Type, Industry, and Country)

    • U.K.

    • Germany

    • France

    • Italy

    • Spain

    • Russia

    • Benelux

    • Nordics

    • Rest of Europe



  • Middle East & Africa (By Solution, Enterprise Type, Industry, and Country)

    • Turkey

    • Israel

    • GCC

    • North Africa

    • South Africa

    • Rest of Middle East & Africa



  • Asia Pacific (By Solution, Enterprise Type, Industry, and Country)

    • China

    • India

    • Japan

    • Southeast Asia

    • ASEAN

    • Oceania

    • Rest of Asia Pacific








Frequently Asked Questions

The market is projected to reach USD 92.12 billion by 2032.

In 2023, the market stood at USD 26.09 billion.

The market is projected to grow at a CAGR of 15.0% over the forecast period (2024-2032).

Fraud and prevention solution segment is likely to lead the market.

Paypal Holdings, Inc., Thales, Bluefin Payment Systems LLC, and PayU are the markets top players.

North America is expected to hold the highest market share.

Asia Pacific is expected to grow with the highest CAGR.

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