Sunday, April 14, 2024

    In-vehicle payment transaction volumes to exceed 4.7bn by 2026, as collaboration accelerates growth

    The global transaction volume of in-vehicle payments – where payments are made via vehicle systems, without requiring the use of a smartphone to process the transaction – will exceed 4.7 billion by 2026, up from just 87 million in 2021, according to data from Juniper Research.

    This extraordinary growth of over 5,300% in the next 5 years will be driven by increasing industry collaboration and initiatives from vehicle manufacturers, aimed at reducing the high level of fragmentation between different in-vehicle marketplaces. Payments vendors will need to quickly develop new capabilities in order to capitalise on this growing opportunity.

    As a result, we anticipate the rate of acquisitions and partnerships to intensify to meet these urgent requirements.

    The new research, In-vehicle Payments: Opportunities, Challenges & Market Forecasts 2021-2026, found that North America will have the largest in-vehicle payments share of transactions by volume; accounting for 42% of all transactions globally by 2026. The growth is driven by a large installed base of payment‑enabled vehicles and a high level of partnerships in place. T

    he recent collaboration between industry participants in North America will be beneficial in overcoming fragmentation and incentivising user adoption through rewards and loyalty schemes over the next five years.

    The research found that vehicle fuelling will be the most common use case over the next five years; accounting for around 48% of total in-vehicle payment transactions by volume. This growth is being seen as the natural progression for fuel payments, which have evolved from cash to card payments, then to smartphone payments, and now to in-vehicle payments.

    The report recommends that stakeholders look beyond fuelling and EV charging to develop additional use cases such as coffee shop and fast food pick-up payments via the vehicle dashboard; using existing infrastructure in developed regions. Enabling voice commerce will be critical in exploring these opportunities and will require vendors to develop new capabilities.

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