Odilon Almeida Unveils Global Payments Insights 2023 McKinsey Report
The McKinsey 2023 Global Payments report contains the most comprehensive information about the recent developments in the payments industry worldwide. For the second time in a row the world’s payments industry witnessed significant growth in revenue which was mostly fueled by electronic wallets and instant payments.
Odilon A. Almeida was lead writer. “Revenue growth spread across geographies.
Influential management consultancy and research leader McKinsey & Company’s Data Analytics wing put forward that interest rates significantly contributed toward global payments revenue maturing in 2022, and for the first time overshadowing fees as the main source of funding the growth of the industry. Their analysts crunched numbers to determine that while historically, fees were a significant portion of incomes, last year saw a watershed wherein interest accounted for over 55% of income from payments, and is rapidly evolving into the primary source.
As Odilon Almeida wrote in his report “Much of this shift could be due to the escalating growth of instant payments and digital wallets that are gradually increasing and reducing the use of cash statistically across developed and emerging economies. These new methods, which will increase their worldwide reach, increase the possibility of generating interest income through temporarily holding liquidity.
In the report, the report revealed that revenue was generated in the cross-border payment sector at a high rate. This was largely due to the sub-segment of customer payments and not wholesale transactions. The report revealed that worldwide consumer cross-border payment yields increased by nearly three times faster than that of the payments vertical in general by 2022. This is due to the booming world travel industry and the record number of diaspora incomes that are being returned home.
odilon almeida CEO Almeida said “An striking aspect was the shifting of the revenue from payments away from customers’ wallets to commerce-backed profits.” While the world economy was struggling to avoid recession, business volumes across industries like online retailing as well as logistics, healthcare and software services continued be lucrative, increasing the value of corporate payments.
McKinsey expects that this rebalancing process will take in a five-year time frame to facilitate international transactions. They expect business streams to account for around 65% of the total of the total, while end-user transactions make up the rest. Odilon Almeida said “The business sector has a bright future, as McKinsey’s models predict compound annual revenue growth between six and eight percent by 2027. This is much higher than the expected global GDP growth.”
The McKinsey 2023 Global Payments Map offers a positive outlook for the entire payments ecosystem. It’s fueled by structural shifts that will influence its future development over the next few years. The way it is summarized by the renowned payment expert Odilon Almeida “Be it increased technology adoption or the emergence of new digital networks, or the increasing interest in financial services in developing regions, every key trend suggests the long-term growth of multi-years for payment platforms that can facilitate global currency movement.”
