Payment Gateway Market Size - By Type, By Application, Organization Size, Analysis, Share, Growth Forecast, 2024 - 2032

Payment Gateway Market Size

The global payment gateway market size was valued at USD 29.4 billion in 2023 and is projected to grow at a CAGR of over 19.5% between 2024 and 2032. The rapid growth of e-commerce sales is a significant driver of the market, as more consumers turn to online shopping for convenience and accessibility. With the rise of platforms such as Amazon, Alibaba, and numerous local e-commerce websites, shoppers are increasingly relying on digital transactions for a variety of products and services.
 

This shift not only boosts demand for efficient and secure payment solutions but also creates a competitive landscape where businesses must offer seamless payment experiences to attract and retain customers. Payment gateways play a crucial role in facilitating these transactions by providing secure processing, multiple payment options, and real-time transaction monitoring, ensuring that merchants can meet consumer expectations for speed and reliability. For instance, as per EY news, E-commerce retail sales in India witnessed a 25% growth in 2022, with an expected compounded annual growth of 20% till 2030.
 

Moreover, growing internet penetration enhances this trend by expanding access to online shopping across diverse demographics and regions. As more people gain access to the internet, especially in developing countries, there is a corresponding increase in the number of potential online shoppers. Mobile devices have further accelerated this growth, allowing consumers to make purchases from anywhere at any time.
 

This surge in internet users drives the need for payment gateways that can handle various payment methods, including credit cards, digital wallets, and mobile payments, thus accommodating diverse consumer preferences. As businesses adapt to these changing consumer behaviors, the demand for robust payment gateway solutions continues to rise, propelling growth in the market overall.
 

Payment Gateway Market Trends

Biometric technology is gaining significant traction in the payment gateway industry as it enhances security and user convenience by leveraging unique physical characteristics for authentication. Unlike traditional password or PIN-based systems, biometrics—such as fingerprints, facial recognition, and iris scans provide a higher level of security due to their uniqueness and difficulty to replicate. This advancement minimizes the risk of unauthorized access and fraud, as it is considerably harder for malicious actors to spoof biometric data compared to stealing passwords.
 

As payment gateways integrate biometric authentication methods, they can offer merchants and consumers peace of mind, fostering trust in digital transactions and reducing the incidence of chargebacks and identity theft.
 

For instance, in June 2024, Mastercard, Empik and PayEye announced to launch an in-store biometric payment pilot leveraging iris and facial biometrics. In cooperation with PayEye fintech, and technology partner Planet Pay, customers will be able to test paying for purchases with their glance in five Empik stores across Poland. This is the first Biometric Checkout Program pilot in Europe. The pilot is launching in response to the growing popularity of biometric technology.
 

Globally, 74 percent of consumers say they have a positive attitude toward biometric technologies. In Poland, meanwhile, 4 out of 5 respondents say that they use or have used biometric technology, and among 18–25-year-olds, virtually all are familiar with using biometrics.
 

Rising cybersecurity issues pose a significant restraint on the growth of the payment gateway market, as both consumers and businesses become increasingly aware of the risks associated with digital transactions. High-profile data breaches and cyberattacks have heightened concerns over the safety of personal and financial information, leading to a reluctance among consumers to engage in online payments.
 

This skepticism can result in reduced transaction volumes and lower adoption rates for digital payment solutions, ultimately impacting the revenue potential for payment gateway providers. As consumer trust diminishes, businesses may hesitate to invest in payment technologies, fearing potential losses associated with fraud and compromised data.
 

Payment Gateway Market Analysis

Based on type, the market is segmented into hosted, non-hosted, and local bank integrated. In 2023, the hosted accounted for over 60% of the market share and is expected to exceed USD 80 billion by 2032. The rise of mobile commerce has driven hosted payment gateways to optimize checkout flows for mobile devices. These gateways now feature responsive designs and seamless mobile experiences, reducing payment friction. As mobile shopping grows, hosted gateways prioritize mobile-friendly layouts that adapt to various screen sizes and improve load times.
 

Integrating Apple Pay and Google Pay further enhances the mobile checkout experience. Global eCommerce necessitates multi-currency support in hosted payment gateways. These gateways now facilitate transactions in multiple currencies, enhancing convenience for international customers. For instance, in August 2024, Three payment companies have secured the cross-border payment aggregator license from the Reserve Bank of India (RBI). These companies are BillDesk, Amazon Pay, and Adyen. They join Cashfree, the first company to obtain this license, on the list of authorized payment aggregators.
 

Based on the organization size, the payment gateway market is divided into SME and large enterprise. The large enterprise segment held 65.5% of the market share in 2023. Large enterprises require payment gateways that integrate seamlessly with ERP and CRM systems like SAP or Oracle to streamline financial processes. By automating payment workflows and integrating with invoice, accounting, and inventory systems, these gateways enhance operational efficiency. Custom APIs and advanced integration capabilities are essential for managing complex financial ecosystems, enabling real-time data sharing and reporting.
 

For instance, in August 2024, EBizCharge and PDI Technologies have partnered to integrate a payment solution within the PDI Enterprise ERP system. This integration enabled PDI Enterprise users to process credit cards directly through the EBizCharge payment gateway. Fully PCI compliant, EBizCharge will provide advanced data encryption and tokenization to ensure maximum transaction security.
 

U.S. accounted for a payment gateway market share of over 65% in 2023. In the U.S., payment gateways are increasingly adopting artificial intelligence to enhance fraud detection, streamline transactions, and provide personalized payment experiences, driving higher customer satisfaction and retention rates. For instance, in April 2024, Paysafe enhanced its offerings in the U.S. iGaming sector by launching Pay by Bank, a new payment solution aimed at streamlining the deposit process for online bettors. This innovative service enables users to log directly into their bank accounts at the cashiers of online sportsbooks, allowing for real-time funding of wagers.
 

In Europe, there is a significant shift towards open banking and integrated payment solutions, driven by regulatory changes like PSD2. This trend enables seamless transactions and enhanced customer experiences through improved data sharing, fostering competition among payment providers while ensuring security and compliance with strict regulatory frameworks across member states.
 

In the Asia-Pacific region, rapid urbanization and mobile penetration are fueling the demand for digital payment solutions. Payment gateways are increasingly adopting advanced technologies like AI and blockchain to enhance security, streamline transactions, and support diverse payment methods, including QR codes and digital wallets, catering to the region's diverse consumer base.
 

Payment Gateway Market Share

The payment gateway industry features a diverse range of competitors, including established financial institutions and innovative fintech startups. Major companies such as PayPal, Authorize. Net, and Adyen lead the market, using their extensive technology infrastructure, brand recognition, and large customer bases to provide comprehensive payment solutions, And top seven companies collectively held a substantial market share of 27% in the payment gateway market in 2023.
 

PayPal service enables users to securely transfer money using email or a mobile application. PayPal also offers different payment gateway solutions for various market segments. These include PayPal Payments Standard, which allows merchants to easily accept payments on their websites, and PayPal Payments Pro, which provides more advanced features such as customizable checkout options and support for recurring payments.
 

Adyen's platform includes powerful analytics tools that offer businesses valuable insights into their transactions. Additionally, the company implements advanced fraud protection measures to ensure transaction security. Adyen's services are designed to be scalable and easily integrated, making them suitable for a wide variety of global businesses.
 

Payment Gateway Market Companies

Major players operating in the payment gateway industry are:

• Adyen
• Amazon
• Authorize
• Braintree
• Payoneer
• PayPal
• Skrill
• Square
• Stripe
• Verifone
   

Payment Gateway Industry News

• In August 2024, PayU announced its partnership with Fynd to offer enhanced payment experiences for merchants in India. The partnership aligns well with both companies’ commitment to helping Indian merchants become digital-first and unlock new revenue opportunities.
   
• In August 2024, Leading financial services business Cardstream and multichannel payments provider PayPoint Plc (PayPoint) have officially announced their collaboration.  The powerful partnership sees PayPoint integrating Cardstream’s Gateway Connectivity into their MultiPay digital payments platform, which will allow it to continue to build a robust and scalable solution for clients.
   

The payment gateway market research report includes in-depth coverage of the industry with estimates & forecasts in terms of revenue ($ Mn/Bn) from 2021 to 2032, for the following segments:

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Market, By Type

• Hosted
• Non-hosted
• Local bank integrated

Market, By Organization Size

• SME
• Large enterprises

Market, By Application

• Travel and hospitality
• Retail & e-commerce
• Media & entertainment
• Healthcare
• Energy & utilities
• IT & telecom
• BFSI
• Others

The above information is provided for the following regions and countries:

• North America
  • U.S.
  • Canada
• Europe
  • UK
  • Germany
  • France
  • Italy
  • Spain
  • Netherlands
• Asia Pacific
  • China
  • Japan
  • India
  • South Korea
  • ANZ
  • Southeast Asia
• Latin America
  • Brazil
  • Mexico
  • Argentina
  • Colombia
• MEA
  • South Africa
  • UAE
  • Saudi Arabia
  • Israel