Market Trends of Spain Payments Industry
This section covers the major market trends shaping the Spain Payments Market according to our research experts:
Retail industry to see significant growth in the country
- The payment market is changing with consumer behavior. Cashless economies, mobile banking, instant payments, digital commerce, and increasing regulatory influence affect the payments market, mainly in the retail industry. Contactless payments also simplify the checkout process and are more convenient for consumers who benefit from shorter cues, no cash hassles, and faster cues.
- E-commerce payment settings continue to move from cash and credit cards to digital wallets, buy now and pay later (BNPL). Factors contributing to the decline in credit card share include the rise of alternative payment methods, volume shifts to credit and debit-linked digital wallets, consumers choosing interest-free credit in the form of BNPL, and so on. Also, travel, which is becoming more and more popular, is still recovering from the effects of the pandemic.
- In the coming months, Spain is expected to witness the integration of trends observed during the pandemic. Retailers can be noted to add new product lines and new plans to reach new goals. Commercial lines that are not part of the core business use the latest contactless shopping technology to turn stores into experiential destinations and integrate online channels with specific areas to shop and receive orders.
- Further, booking systems, online ticketing, and QR codes for menus and payments are some of the technologies created to minimize physical contact. One of the rapidly growing use cases for barcodes in the retail sector is in-store payment, specifically, using consumer apps to generate a QR code, which can then be scanned at checkout to transfer payment information. These kinds of payment options will leverage the payments market in the country.
- However, cash has historically dominated retail payments and is still the preferred payment method in the country. Due to the increased awareness and profits associated with cards, consumers are gradually moving to digital payments. In this country, the adoption of digital payment services, mainly card payments, is increasing rapidly to make transactions more convenient and straightforward.
Understand The Key Trends Shaping This Market
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Increased adoption for contactless and digital payments is driving the market
- Digitization of payments as the mainstream trading method from cash to digital mode is driving the growth of the markets studied. The country can be identified by heavy card payments such as debit cards and credit cards. Increasing demand for contactless card payments is also a significant market driver. Contactless payments have existed for some time, even before the pandemic. The COVID-19 pandemic fuelled this trend.
- Spanish digital wallet PayPal and local wallet BBVA wallet have a significant market share in 2021, followed by credit cards as the region's leading e-commerce payment method. In Spain, digital wallets, credit cards, and BNPL are increasing, but debit cards, bank transfers, and cash on delivery stocks are expected to decline by 2025.
- The rapid adoption of contactless payments has set Spain into a significant payment market. The country's people are enthusiastic about these methods and surged in recent years, especially in 2020, when the market peaked in cash usage declines. Increasing retailer acceptance of payment cards and increased adoption of contactless technology are also expected to facilitate card payments, thereby reducing cash dependence in the economy over the next few years.
- The domestic contactless payment limit has been raised to facilitate the adoption of contactless payments. Further, to expand the use of transit, in September 2021, the Ministry of Transport and Renfe installed a POS terminal at Cercanías Station with the support of MasterCard and Santander, allowing travelers to use the card for contactless payment by announcing the launch of the Cronos Project, which enables contactless payments.
- Furthermore, the country is anticipated to benefit from the rolling out of SCT Inst. In December 2021, BNP Paribas announced that it continues to roll out the SEPA Instant Payments plan across Europe and has now activated SEPA Instant credit transfers in Spain for its corporate customers, including EDPR a key player in the renewable energy sector.
