by In-vehicle payment services allow drivers and passengers to make payments for goods and services directly from their vehicle. It provides a seamless experience for making food deliveries, drive-through payments, toll payments, parking, and fuel purchases. Drivers can link their preferred payment method like credit/debit cards, digital wallets to the in-vehicle system. Growing preference for contactless payment solutions that ensure safety and hygiene amid the COVID-19 pandemic is driving demand for in-vehicle payment services.
The global in-vehicle payment services market is estimated to be valued at US$ 7.24 Bn in 2023 and is expected to exhibit a CAGR of 10% over the forecast period 2024 to 2031, as highlighted in a new report published by Coherent Market Insights.
Market Dynamics:
Growing demand for contactless payment systems: Contactless payments allow users to make transactions by tapping or waving their cards or smartphones near a payment terminal without entering a PIN. The COVID-19 pandemic has accelerated the shift towards contactless payments as they allow for quick transactions without any physical contact, ensuring safety and hygiene. In-vehicle payment services offer a true contactless experience by enabling payments directly from the vehicle. This growing preference for contactless payments is driving demand in the global in-vehicle payment services market.
Introduction of innovative technologies: Companies are investing in developing innovative technologies to enhance the in-vehicle payment experience. For instance, technologies allowing users to make payments with a simple voice command or gesture are gaining popularity. Integrating advanced features like digital wallet connectivity, autonomous vehicle compatibility, etc. is expected to boost the adoption of in-vehicle payment services. The introduction of such innovative solutions will support the market growth over the forecast period.
Segment Analysis
The in-vehicle payment services market can be segmented by payment type, vehicle type, application, and region. Among payment types, the remote payment type segment is dominating currently as it provides advanced solutions for contactless payment options from inside the vehicle. The remote payment type segment avoids any physical interaction and allows payments through mobile applications.
PEST Analysis
Political: Governments across regions are introducing regulations to ensure secure transactions and protect customers’ financial data during in-vehicle payments. This is driving the adoption of advanced solutions.
Economic: Rising disposable incomes and changing consumer preferences towards cashless transactions are fueling the demand for in-vehicle payment services. The industry is expected to grow exponentially with increasing digitization.
Social: Younger demographics are adopting digital payment solutions at a rapid pace. Their preference for convenience and seamless experiences is accelerating the demand. Moreover, safety concerns regarding virus transmission through cash are boosting contactless options.
Technological: Advancements in technologies such as connected cars, mobile applications, blockchain, and 5G are enabling secure and instant payments directly from vehicles. Technologies ensure privacy and protect from cyber threats.
Key Takeaways
Global In-Vehicle Payment Services Market Size is expected to witness high growth during the forecast period of 2024 to 2031.
North America is currently the dominant region owing to strong infrastructure for connected car technologies and digital payments.
Key players operating in the in-vehicle payment services market include Apple Inc., Amazon Renewed, Samsung Electronics, Best Buy Co., Inc., Gazelle (a subsidiary of ecoATM Gazelle LLC), Newegg Inc. The industry is competitive with companies focusing on delivering superior customer experience to tap the widespread opportunity. Security of financial transactions and personal data will remain the vital aspects governing the demand for in-vehicle payment services.
*Note:
1. Source: Coherent Market Insights, Public sources, Desk research
2. We have leveraged AI tools to mine information and compile it
