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Behind the Scenes of Commerce, Covid-19 Hits the Payments Sector Hard

Annual revenues will drop by almost one-third at some payments companies.

スナップチャート

Behind the Scenes of Commerce, Covid-19 Hits the Payments Sector Hard
Shutdowns due to coronavirus slam the payments sector
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Consumption in sectors hit hard by the coronavirus, such as restaurants, transportation, tourism and retail, account for roughly two-thirds of payment volumes worldwide, Bain & Company estimates. Even e-commerce categories ranging from clothes to furniture have gone quiet. Because most international travel has disappeared, cross-border transactions have dropped. That’s significant because higher transaction fees and foreign-exchange spread mean that cross-border payments represent more than half of revenues for many payment companies such as Visa. We estimate a roughly 30% decline in 2020 revenues from companies with high exposure to cross-border payments. Most types of payments companies will need sharp responses to stabilize in the near term. Further out, as the economy recovers, they need to find ways to strengthen their customer relationships and boost adoption of digital solutions such as contactless payment.

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