Digital wallets will account for $1.35 trillion in spend worldwide this year—a 32 percent increase from last year, according to a new report. And, while Alipay and WeChat are driving the lion’s share of that spending in China and other Asia Pacific countries, wallets from Apple, PayPal (which the research pegs as occupying the “pole position” in the wallet wars) and others will increasingly become the default payment mechanism in North America as well, U.K.-based Juniper Research said in Mobile Wallets: Service Provider Analysis, Market Opportunities & Forecasts.
According to a separate report, the shift in the U.S. has already begun with Americans becoming increasingly comfortable transferring money via digital wallets. Financial services comparison site finder.com said its research showed that 43 percent of those polled used a mobile wallet to send or receive money in 2016—an estimated 106.6 million adults. Thirty-one percent said they use digital wallets at least once a month.
“Most of us carry our phones with us everywhere we go and new mobile apps are making it easier than ever for it to be the only thing you leave the house with. So we’re not surprised by the popularity of digital wallets,” said Michelle Hutchison, money expert at finder.com. “Traditionally, U.S. banks have charged high fees for transferring money from your bank account to other people but payment apps allow you to sidestep those fees by removing the bank as the middleman. For instance, major banks may charge up to $10 in next-day transfer fees, compared to one digital provider, Venmo, with one business day transfers not incurring any transaction fees. While banks have been late to join the movement, media reports suggest they are no longer sitting on the sidelines.”