Spain Real Time Payments Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

Market Overview

Spain's real-time payments market is expected to register a CAGR of 16.8% during the period 2022-2027. The primary factors driving the market's growth are the increasing smartphone penetration, growing participation from banks and financial institutions, and government initiatives, among others.

• The payment system in Spain is still heavily dominated by debit and credit cards, which account for most of the transactions in the country. However, the scenario is continuously changing after the pandemic, and mobile wallets, digital payments, and alternative payments such as real-time payments are gaining ground in the Spain payments market.
• Spain's real-time payment market is growing rapidly, owing to the wildly successful Bizum app. Launched in 2016 and built on SCT Inst, Bizum is a payment service launched by Spanish banks in 2016 to allow users to conduct Person-to-Person (P2P) payments through a smartphone. The Bizum mobile wallet has attracted millions of customers and has regularly added features beyond its original P2P functions.
• A few factors that boosted the rapid adoption of real-time payments, such as the modern Bizum user interface replicating social networks. Another is a steady stream of use cases that take real-time payments deeper into consumers' lives. These include support for donations to NGOs, eCommerce payments launched in 2019 and refunds, and even real-time settlement of national lottery prizes. Its ease of use is also boosted by widely available QR-code initiation adopted at more than 11,000 retail stores.
• Moreover, banks and e-commerce platforms have started offering real-time payment services such as Buy Now Pay Later options like Klarna and Afterpay to capture the rapidly growing segment and appeal to new users. With no interest charged for on-time payments by many BNPL platforms, people without credit cards can make purchases from a business and pay in installments. BNPL lets companies maintain better checkout rates and customer retention. This is further boosting the region's real-time payments market growth.
• The COVID-19 pandemic has boosted the use of new fast and secure payment technologies, such as real-time payments. However, the volume of transactions has fallen during periods of lockdown or tighter restrictions, but the use of instant money payment or transfer apps has also increased. In Spain, the use of Bizum stands out during the COVID-19 outbreak.

Scope of the Report

Real time payments or instant payments refer to payment rails (platforms or networks via which payments are made) that share a few characteristics, such as they are real-time and initiate, clear, and settle in a matter of seconds. Real-time payment payments are ideally available 24x7x365, meaning they are always online and available for transfer.

The Spain Real Time Payments Market is segmented by Payment Type (P2P, P2B).

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Key Market Trends

P2P Segment is Expected to Dominant the Spain Real Time Payments Market

• Bizum and PayPal are two popular P2P apps customers have used for fast and immediate payments in the region. These offer real-time P2P payments that allow users to transfer money between people so quickly and easily that they are replacing more traditional means of payment and changing the game's rules in terms of national and international transactions. This new way of making bank transfers immediately makes these real-time payments much faster, more efficient, and cheaper for users.
• Moreover, the declining popularity of cash and cards for P2P transactions is further increasing the real-time P2P transactions in the region. Additionally, the surge in P2P payments in Spain is governed by various social interactions and transactions involving money, from dividing up the bill at a restaurant to donating. Also, immediacy and payment notifications in seconds are the key factors that grow customer confidence in the P2P payment service. Bizum is an SCT Ins. Transfer with a more friendly user experience because the phone number is a proxy for the customer's account.
• Furthermore, the growth in P2P is primarily supported by the launch of the Bizum payment service in 2016. Bizum enables customers to make payments from bank account to bank account securely, conveniently, and quickly just by knowing the recipient's mobile phone number. The method is becoming increasingly popular in Spain among youth.
• For instance, as per data reported by the Bank of Spain, the P2P transactions on Spain's real-time payment service for the smartphone was 98.95% in the year 2021, followed by C2eR and C2R, respectively.
• All of the above mentioned factors are expected to boost the P2P real-time payment transactions over the forecast period.

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