According to a new report published by Allied Market Research, titled, “POS Payment Market," The pos payment market was valued at $96.6 trillion in 2022, and is estimated to reach $277917.4 billion by 2032, growing at a CAGR of 11.4% from 2023 to 2032.
A point-of-sale system is a collection of hardware and software that allows for digital and contactless payment processing by facilitating communication with other banks and payment processors. A point-of-sale system becomes crucial since, in the industrialized world, electronic payment methods are used for the majority of sales. For a price, commercial banks offer this point-of-sale service to their clients. Commercial banks charge the customer's account, send the settlement data at the conclusion of the business day, and quickly move the money to the merchant's bank account.
Different payment methods are used for making payments through a point-of-sale system. This can involve using conventional payment methods like cash and checks. The point-of-sale system includes credit cards with POS credit card reader, magnetic stripes, credit cards with integrated chips, clover payment, mobile wallets and digital payments using rapid response (QR) code. The point-of-sale system offers a wide variety of payment options and accelerates payment processing. Globally, companies want an advanced point-of-sale system that they can strategically apply to expand their operations.
Commercial banks charge a transaction fee when funds are routed through their systems. Hence, if a merchant receives $100 via a point-of-sale system, they may receive only $98 after deducting a commission. The percentage of commission being taken becomes gradually smaller as the volume of transactions increases. Large-scale retailers pay a very small percentage of their revenues to commercial banks. Revenue from point-of-sale systems is a significant contributor to the overall revenue being generated by commercial banks. Currently, banks have started facing some competition from newer, more technologically advanced fintech companies. However, even to date, the business of point-of-sale systems is almost completely controlled by commercial banks.
Moreover, increasing adoption of contactless payment and rise in omnichannel retailing are two main significant factors driving the growth of POS payment market. Furthermore, high cost of implementation and maintenance and lack of standardization are two main significant restraints hampering the growth of POS payment market. Moreover, the rise in mobile wallet adoption is providing a significant opportunity for the growth of the market.
Key players in the POS payment market adopted partnership and collaboration as their key development strategy to sustain their growth in the market. For instance, in October 2023, Castles Technology partnered with Worldline to support Worldline’s deployment of android payment terminals and associated services including repair staging. Castles Technology is a global leader in payment industry and Worldline is a French multinational payment and transactional services company. The partnership is expected to strengthen Castles Technology position in the Europe, Middle East and Africa region. In addition, the strategy is expected to also drive Castles Technology growth in other regions by offering a variety of products and services globally. Furthermore, in August 2023, Diebold Nixedorf, a global leader in retail store and checkout innovation collaborated with Thali, top book retailer in the German-speaking region to launch latest self-checkout solutions to improve customer service and assist stores. Planned through mid-2024, a total of 500 modular DN Series EASY eXpress systems for the German market, and more than 100 systems for Austria and Switzerland, is expected to expand checkout options for Thalia customers and allow employees to spend more time serving shoppers. In addition, Diebold Nixdorf is expected to leverage its extensive and experienced services technician network to provide on-site troubleshooting and support services for Thalia in all three countries namely Germany, Austria and Switzerland. Therefore, such strategies adopted by key players are expected to propel the POS payment market growth in the future.
The pandemic pushed digital payment adoption as users are increasingly searching for various contactless and touchless options to avoid the chances of virus transmission. This trend evolved the POS payment market as users and businesses started increasingly using digital wallets, mobile payments and other contactless payment techniques. Moreover, the COVID-19 pandemic prompted people to stay indoors and refrain from outside activities, which impacted the growth of the POS terminal industry. Additionally, many stores were able to maintain their operations owing to the e-commerce operations which increased the demand for POS payment industry.
Key Findings of the Study
- Based on component, the hardware segment accounted for the highest POS payment market share, in terms of revenue in 2022.
- Based on end user, the retail segment attained the highest market share in 2022.
- Based on region, North America generated the highest revenue for POS payment market size in 2022.
The key players in the POS payment market analysis include Acrelec, Aures Group, Hewlett Packard Development LLP, NCR Corporation, Oracle, Revel Systems, Diebold Nixdorf, Incorporated, Moneris, Pax Technology Limited, and Posiflex Technology. These players have adopted numerous strategies to increase their marketplace penetration and strengthen their position in the POS payment market trends.