The 2024 Global Payments Innovation Jury Report, by Interswitch in partnership with the World Bank, and other notable international payment players, namely HPS and Fime has been released. The report, which offers insight into many aspects of the payments industry that were impacted by the recent period of market turmoil comes with these key findings.
- The primary reason for previously high payment company valuations and funding rounds was investors bidding up deal prices and paying insufficient attention to profitability – a view shared by the investors canvassed.
- The above has led to a greater focus on earlier profitability over hyper-growth, which the Jury overwhelmingly regards as a positive for the industry – although there’s a lack of consensus on whether this is a long-term market movement
- Businesses developing AI and climate fintech tools and technologies will benefit from the diversion of investment from payments businesses.
- In emerging markets where cards have not yet gained a significant foothold, they will struggle to gain cut-through when competing with account-to-account payments and mobile money.
- Credit and debit cards will be hard to dislodge from their leadership role in developed markets, but growth will be much harder to achieve than previously.
- Banks, rather than fintechs or mobile network providers, will ultimately be the major players in mobile wallets globally.
- The talent acquisition activities of payment enterprises in developed markets are a significant challenge for those in emerging markets, with almost 60% of Jury members in emerging markets saying that they are losing an unacceptable number of staff with consequential risks to innovation programmes and sometimes even ongoing operations.
- High-profile crypto exchange failures, such as FTX in the US, can impact confidence in global markets – not just where the failures occurred. This is a concern for national regulators but remains complex to address.
- APAC retains its crown as the region with the most payment innovations, but perhaps more surprisingly, Africa & the Middle East was a clear second favorite despite Africa’s macro-economic challenges, relatively low levels of investment funding and now a talent drain – a clear tribute to the resourcefulness of the continent’s entrepreneurs and policymakers.
Comments by Interswitch
John Chaplin, Founder and Chairman of the Payments Innovation Jury, and a Senior Advisor to Interswitch said: “Looking back on the last two years of market turmoil, it feels like this unique insight from industry leaders has never been more needed. Our Jurors’ deep understanding of the causes and effects of macroeconomic changes and their impact on the long-term direction of the payments industry helps all of us understand how we can best move forward and continue to weather the storm.
Mitchell Elegbe, Founder and Group Chief Executive Officer at Interswitch said: “It is gratifying to see the Global Payments Innovation Jury home in on such a topical and contextually relevant theme for this current research effort, and we are pleased at Interswitch to be collaborating as a sponsor and contributor once again.