A white paper looking at the global e-commerce industry has noted growing bank revenues from the payments business, with mobile and online commerce fuelling this continuing trend.

The white paper, Four Corners of Global Payments, published by Ingenico ePayments, an online and mobile commercial payments group, provides insight into e-payments markets in the four regions of North America, Latin America, Asia and Europe.

Opportunities 'cannot be overstated'

It highlights some of the differences between the four regions but notes that the opportunities presented by mobile and online commerce are global, stating: “The opportunities for online and cross-border merchants over the next decade cannot be overstated.” Some of the data highlighted in the paper include:

• North America's e-commerce retail sales are expected to grow by 8.9 per cent in 2018, reaching $493.89bn
• Latin America's e-commerce is expected to reach $84.75bn by 2019
• Asia's share of e-commerce sales is expected to rise from 36.5% in 2014 to 39.7% by 2019
• Europe (including Russia) had e-commerce sales of €424 billion in 2015

$900 billion 'up for grabs'

The paper states that bank revenues from global payments increased by 9 per cent to $1.7 trillion between 2013 and 2014 and that, as a share of bank revenue, global payments rose from 38 per cent to 40 per cent over the same period. The paper's authors write: “We’re expecting to see results from 2015 continuing the trend.”

It also notes the increase of non-cash payments all over the world and that this will continue to increase over the next four years. The value of online payments for merchants is undoubtedly huge and the white paper states “as much as $900 billion is up for grabs over the next decade”. It adds: “Businesses that can capture the migration from cash to electronic payments, deliver innovative value-adding services and effectively serve the unbanked and under-banked will reap the benefits of these opportunities.”

Four different e-commerce markets

The paper underlines how the four regions still operate in different ways, with varying consumer preferences. It says: “Merchants that understand the cultural nuances in each region will be better positioned in their markets.” Some of the regional differences, as described in Ingenico's white paper, include the following:

• North America accounts for more non-cash payments than any other region and e-payments are a key driver of US economic growth;
• Latin America – dominated by the Brazilian market – has a young population (62 per cent under 30) with high mobile phone usage, even though 250 million adults in the region do not use formal financial services such as a bank account;
• In Asia, mobile phone use is fuelling e-commerce and emerging Asia is one of the key growth areas for non-cash payments. Adoption of smartphones and Internet use in China and India are driving mobile payments in the region;
• Europe is a world leader in retail eCommerce sales and the UK, Germany and France are the biggest e-commerce markets in Europe, while Russia is the fastest growing market. Cash is rapidly being eliminated from point-of-sale and regulation is driving down interchange fees.

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CTMfile take: Treasurers in companies operating in these four regions may get some insight from this white paper. But one thing that should ring alarm bells for corporates is the increased revenue banks are deriving from the global payments business.