Global digital commerce spend is projected to reach $34 trillion by 2029, marking a 65 percent increase from $23 trillion in 2024, according to the latest Juniper Research report.
This growth will primarily be driven by Latin America and Asia Pacific, where improved infrastructure and the availability of local payment methods are expanding access to eCommerce. Success in these emerging markets is essential for international digital commerce platforms, as eCommerce in developed regions is becoming saturated.
Growth in Latin America is set to outpace North America by 241 percent in value between 2024 and 2029, underscoring the potential in these regions. To leverage this opportunity, platforms must adopt local payment solutions such as digital wallets and account-to-account (A2A) payments, moving beyond traditional card payment systems.
While cards have been foundational in developed markets, future growth will require a shift towards diverse payment options, including A2A systems, even in developed regions, ensuring platforms can meet the evolving needs of global markets.
Local acquiring enables merchants to lower costs and operate efficiently in international eCommerce by offering customers familiar local payment types and preferred currencies without requiring them to calculate exchange rates. Traditionally requiring multiple partnerships and integrations, businesses can now use a single service to manage all local payment needs, streamlining operations and adapting swiftly to changing consumer demands. This approach improves authorisation rates, as transactions occur in familiar environments for issuing banks, enhancing compliance and reducing false declines.
Leveraging domestic licenses further reduces costs by minimizing cross-border fees and currency conversion charges. In emerging markets, local payment methods expand access for unbanked populations through agent networks, wallet services, and alternative solutions, enabling merchants to tap into broader and rapidly growing customer bases.
eCommerce retailers handling recurring payments face risks related to data breaches and compliance with data protection regulations due to the need to store customer payment data for extended periods. Tokenization mitigates these risks by generating unique tokens representing customer payment data, allowing secure reuse for subscription payments and simplifying the checkout process for returning customers. This approach helps retailers comply with PCI DSS regulations by ensuring stored account data is encrypted and protected during transmission.
Partnering with Payment Support Providers (PSPs) that support reusable payment sources is crucial for scaling subscription operations. These PSPs provide APIs that trigger alerts for non-payments, such as expired cards, and can request updated payment information from card networks. Additionally, integrating APIs into communication channels ensures customers are directly notified of payment failures, enabling swift resolution and maintaining subscription continuity.
The future of payments across geographies is shaped by the growing potential of near-field communication (NFC) for account-to-account (A2A) payments. While A2A payments have gained traction in markets like India with UPI and Brazil with Pix, they have largely relied on QR code-based systems for in-store transactions. QR codes offer low barriers to entry, requiring only a camera-equipped smart device and internet access.
NFC adoption has faced challenges, particularly due to Apple’s historical restriction on third-party NFC applications on iPhones, limiting accessibility for a significant user base. However, this landscape is evolving. In India, the National Payments Corporation of India (NPCI) has introduced UPI Tap and Pay, an NFC-based service that uses NFC to capture the UPI Payee ID, enabling seamless A2A payments.
Soft POS offers merchants an affordable alternative to traditional POS systems by enabling electronic devices, such as smartphones and tablets, to function as POS terminals through downloadable software. Initially compatible only with Android, Apple’s introduction of its Tap to Pay solution has extended Soft POS compatibility to iOS devices. By eliminating the need for additional hardware, Soft POS reduces financial barriers, making it a cost-effective option for merchants, especially in emerging markets.
However, Soft POS is limited to accepting contactless payments, which restricts its utility in regions where contactless transactions are less common. While some view Soft POS as a potential threat to traditional POS systems, it is more likely a successor to mobile POS (mPOS), thriving in microtransaction environments. Despite its advantages, fixed POS terminals will remain essential in certain retail and hospitality contexts. The introduction of Apple’s Tap to Pay has further mainstreamed Soft POS, highlighting its potential for widespread adoption, particularly in markets with limited physical payment infrastructure.
