Study: In-Vehicle Payment Spend To Exceed $86 Billion in 2025by Fintechnews Switzerland September 23, 2020
A new study from Juniper Research has found that the value of in-vehicle payments, where a payment is made via embedded vehicle systems, will reach $86 billion in 2025, up from just $543 million in 2020.
In-vehicle payments automate and simplify several existing payment processes via the vehicle’s onboard systems; providing increased convenience for drivers. This dramatic growth will be driven by increased partnerships which are improving the availability of services, particularly in the fuel and smart parking segments.
The report recommended that, in order to support this rapid growth, established payments vendors must be included within collaborative ecosystems, to ensure that requirements such as security via tokenisation and integration with digital wallets are achieved effectively. These elements will be critical in establishing in-vehicle payments as a viable channel and, if ignored, will likely see initiatives fail to achieve widespread adoption.
Fuel & Charging Payments Dominating Market
The new research, In-vehicle Payments: Adoption, Vendor Positioning & Market Forecasts 2020-2025 Report, found that fuel and electric vehicle charging payments will be the leading area for in-vehicle payments adoption; accounting for 77% of payments by value in 2025. This will be largely due to the high number of anticipated future partnerships in this area, as well as the ease of migrating existing mobile payment solutions into in-vehicle systems.
Research co-author Nick Maynard notes: ‘Fuel and charging can be the compelling use case that accelerates the adoption of in-vehicle payments, but to achieve this, industry participants must focus on building collaborative frameworks that boost integration and improve availability.’
Voice Commerce Driving Wider In-car Commerce Uses
The research found that voice commerce will be a major supporting factor in the in-vehicle payments market. The increasing integration of voice assistants within the vehicle’s systems, not just via smartphone mirroring, will enable drivers to make eCommerce purchases from behind the wheel in a seamless way. This will drive other in-vehicle payments, including eCommerce, food and drinks to over $11 billion in 2025, from just $12 million in 2020.