Payments - Worldwide

Data coverage:

The data on the digital payments market are based on transaction values, revenues, and user data of relevant services and products offered within the FinTech market. The data on the remittances market encompasses personal remittances as well as migrant stock data. Figures are based on "personal transfers" and "compensation of employees" recorded in the Current Account of the Balance of Payments framework, which records a country's transactions.

Modeling approach / Market size:

Market sizes are determined through a combined top-down and bottom-up approach, building on a specific rationale for each market segment. As a basis for evaluating markets, we use data provided by the World Bank, annual financial reports of key players industry reports, third-party reports, publicly available databases, annual market size estimates, country flow estimates, and survey results from primary research (e.g., the Statista Consumer Insights). In addition, we use relevant key market indicators and data from country-specific associations, such as GDP, inflation rates, exchange rates, unemployment, consumer spending, population, internet penetration, smartphone penetration, credit card penetration, and online banking penetration. This data helps us estimate the market size for each country individually.

Forecasts:

In our forecasts, we apply diverse forecasting techniques. The selection of forecasting techniques is based on the behavior of the particular market. In this market, we use a multiple linear regression method to forecast future development. The main drivers for the Digital Payments market are consumer spending, internet penetration, smartphone penetration, credit card penetration, and online banking penetration, while the main drivers for the Remittances market are GDP growth rate, exchange rate fluctuation, inflation rate, and migrant population growth. The scenario analysis is based on a Monte Carlo simulation approach generating a range of possible outcomes by creating random variations in forecasted data points, based on assumptions about potential fluctuations in future values. By running numerous simulated scenarios, the model provides an estimated distribution of results, allowing for an analysis of likely ranges and confidence intervals around the forecast.

Additional notes:

The remittances market uses calculations from the World Bank and its KNOMAD division as a base, including annual market size estimates, bilateral country flow estimates, and a database on remittances prices. In theory, inward and outward remittances should balance out and be equal because remittances are financial flows between countries. However, practical issues such as data collection methods, informal channels, fees, and timing lead to a mismatch in the reported figures. The focus on inward remittances in developing countries, which rely heavily on these flows, often results in better tracking of inflows than outflows. The figures therefore differ in the respective markets. The market is updated twice a year in case market dynamics change.