Credit Card Payments Market Expected to Reach $1204.5 Billion by 2032—Allied Market Research

According to a new report published by Allied Market Research, titled, “Credit Card Payments Market, by Product Type (General purpose credit cards, and Specialty and other credit cards), Application (Food and Groceries, Health and Pharmacy, Restaurants and Bars, Consumer Electronics, Media and Entertainment, Travel and Tourism, and Others), and Brand (Visa, MasterCard, and Others): Global Opportunity Analysis and Industry Forecast, 2023-2032." The credit card payments market was valued at $524.93 billion in 2022, and is estimated to reach $1204.5 billion by 2032, growing at a CAGR of 8.8% from 2023 to 2032.

A credit card is a card issued by a financial institution, typically a bank, and it enables the cardholder to borrow funds from that institution. Cardholders agree to pay the money back with interest, according to the institution's terms. A credit card can help business build a better credit history for purchase of equipment, supplies, or inventory that are needed for the business, which helps businesses to easily get loan based on their credit score.

Furthermore, the key factor that drives the credit card payments market trends includes rise in demand for cash alternatives and availability of affordable credit cards across the globe. In addition, rise in demand for credit card among the developing nations positively impacts the growth of the credit card payments market. However, factors such as increase in credit card frauds across the globe is expected to hamper the market growth. On the contrary, technological advancements in product offering like using blockchain for increased security is expected to offer remunerative opportunities for the expansion of the credit card payments market during the forecast period. 

On the basis of application, the food & groceries segment dominated the credit card payments market size in 2022, and is projected to maintain its dominance during the forecast period. This is attributed to several benefits provided by credit card payments such as shorter queues for transaction, improved customer satisfaction, ability to capture data on customer buying behavior, and surge in adoption of credit card payments in the retail sector. However, the travel & tourism segment is expected to grow at the fastest CAGR during the forecast period, owing to rise in adoption of credit card payment technologies such as NFC and RFID among travel and other tourism industries.

The credit card payments market has had significant growth in the past few years; however, due to the outbreak of the COVID-19 pandemic, the market experienced a sudden growth in 2020. This is attributed to the implementation of lockdowns by governments in the majority of the countries, rise in pay delays & and job losses, and borrowing credit by individuals to cover their daily expenses. In addition, consumers paid their credit card bill payment in the early months of the pandemic to increase their credit scores. Furthermore, credit card balances for open accounts decreased by an average of 10% from March 2020 to June 2020, attributed to a huge wave of job loss. Moreover, various market players are increasing charges on swipe payments for merchants in their credit cards to increase contactless credit card reader to their market portfolio in the pandemic situation. In addition, from March 2020, there was a sharp increase in the share of accounts that had a balance but did not make a payment. Furthermore, 69% of retailers accepted some type of contactless payment to reduce spread of COVID-19 and reduce long lines at billing counter.

Moreover, pre-COVID-19 customers were satisfied with their credit card but with the hit of pandemic overall card satisfaction dropped 10 points on a 1,000-point scale. The decline was led by lower satisfaction with credit card terms and credit card company communications. The COVID-19 pandemic has had a significant impact on the credit card payments market. This is attributed to significant investment in advanced technologies such as cloud technology, Big Data, artificial intelligence, and machine learning, due to rise in adoption of cloud-based software by various companies across the globe. In addition, rise in fintech solutions for managing various credit cards are expected to provide lucrative opportunity for the credit card payments market like google pay, apple pay and various digital wallets that uses credit card. In addition, with the opening of markets, the credit card payments market is expected to recover owing to rise in economic situations and decrease in unemployment. In addition, apps like CRED which use credit card and provide various features like paying through its app can get rewards.

Furthermore, it allows users to make house rent payments and introduced short-term credit lines. Furthermore, card issuers are investing in NFC technology that allows credit card companies to offer contactless payment at one tap. In addition, it is an effective tool against online banking fraud as it uses tokenization, which completes the transaction without sharing the merchant’s actual credit card information. These are major factors that provide lucrative opportunity for the credit card payments market growth.

Key Findings of The Study

• By product type, the general purpose credit cards segment accounted for the largest credit card payments market share in 2022.
• Region wise, North America generated highest revenue in 2022.
• Depending on brand, the visa segment generated the highest revenue in 2022.

The key players profiled in the credit card payments market analysis are American Express, Bank of America Corporation, Barclays PLC, Capital One, Citigroup Inc., JPMorgan Chase & Co, MasterCard, Synchrony, The PNC Financial Services Group, Inc., and USAA. These players have adopted various strategies to increase their market penetration and strengthen their position in the credit card payments industry.