In-Vehicle Payment Services Market Size, Share & Trends Analysis Report By Mode of Payment (NFC, QR Code/RFID, App/Wallet Based, Credit /Debit Card based), By Application (Parking, Gas Stations & Charging Stations, Shopping, Food & Coffee, Toll Collection, Others) and By Region(North America, Europe, APAC, Middle East and Africa, LATAM) Forecasts, 2022-2030

Market Overview

The global in-vehicle payment services market size was valued at USD 4930 million in 2021 and is estimated to reach an expected value of USD 19500 million at a CAGR of 16.5% during the forecast period (2022–2030).

Increasing contactless payment post-COVID outbreak trends, growing customer base to achieve convenience in vehicles, and growing technology innovation are the major factors driving the market. The in-vehicle payment services permit the driver of the vehicle to simultaneously shop for groceries, order food and Coffee, and pay tolls & parking and at the gas stations for the vital commodity. The automotive industry is continuously evolving around the Internet of Things (IoT), and automotive manufacturers are increasingly integrating new technologies for innovative infotainment solutions.

Market Dynamics

Global in-vehicle payment services market drivers

Growing Mobile Payments Adoption

Currently, the upgradation of regular payment infrastructures is in progress. The payments industry is going through a movement of infrastructure transformation that is essential to compete efficiently with nonbank trendsetters and address progressing customer requirements. More than 15 countries have modernized their payments infrastructures in the last few years, and many others are scheduling to upgrade. As the infrastructure renovations are costly for both the system and bank levels, banks need to find ways to build products and services on top of the infrastructure that provides value to end-users and accelerate the cash transactions to recover these investments as rapidly as possible.

Digital disruption in the money transfer ecosystem, combined with the rise in the need for quick money transfer methods, has transformed the payment gateway model. As a result of digital money transfer methods, consumers now demand secure digital transaction processing systems to transfer money to their merchants and individuals. With the rising digital financial transactions, a need for secure cloud-based architecture has increased among platform providers. The cloud-based money transfer platforms allow industry participants to manage higher volumes of transactions at high speed and low cost.

Increasing Technological Innovation in Automotive

General Motors partnered with MasterCard to develop a solution for in-vehicle payment. Visa, in collaboration with SiriusXM, has announced to launch a vehicle-based payments platform. Other manufacturers such as Honda, Volkswagen, and Ford have developed their in-vehicle payment platforms and solutions. Manufacturers are developing inbuilt systems such as voice-based control, enabling shopping on the road with safety for the drivers. Drivers need to keep their eyes and hands focused on the streets and highways while accomplishing their purchasing needs. The voice-activated dashboard can distract the driver. According to a study conducted at the University of Utah, speech-to-text technology causes a higher cognitive distraction level than any other activity since more effort is required to talk to the dashboard than talking to a real person. However, the connected and self-driven car's growth is expected to fuel the market growth in the coming years.

Global in-vehicle payment services market restraint

Security of Driver And Payment Data

With the growing adoption of connected cars and in-vehicle payment services, the primary concern is data storage and security. The automotive industry, including connected cars and electric vehicles, contributes to the maximum data generation. Hackers can locate and track the payment information causing significant financial losses. However, cloud storage resolves the issues of data storage and management.

Regional Analysis

By region, global in-vehicle payment services market is segmented into North America, Europe, Asia Pacific, Latin America, Middle East & Africa.

North America accounted for the largest market share and is estimated to grow at a CAGR of 15.9% during the forecast period. The region has the highest penetration of connected cars. Also, technological giants such as Google Inc. and Apple Inc. have entered the automotive market to develop innovative capabilities and cultural changes to compete with those that are based out of the region.

Europe is the second largest region. It is estimated to reach an expected value of USD 3395 million at a CAGR of 16.4% during the forecast period.

Asia Pacific is the third largest region. The in-vehicle payment services market in the Asia Pacific region is anticipated to grow at the highest compound annual growth rate owing to the growing population and rising disposable income. Technological proliferation and innovations in the payment industry are expected to drive demand over the forecast period.

Segmental Analysis

The global In-Vehicle Payment Services Market is segmented by Mode of Payment and application.

Based on the Mode of Payment

NFC segment in the In-Vehicle Payment Services market focuses on using Near Field Communication (NFC) technology for transactions within vehicles. It is the standard for wireless communication, allowing proximity data exchanges between devices to effectuate contactless and secure payments. This technology has been integrated more and more into vehicles, whereby drivers can pay for fuel, tolls, and parking without leaving the vehicle or having to deal with cash. The convenience and speed of NFC payments, combined with its security features, make it a popular choice for automakers and service providers.

QR Code/RFID segment is gaining traction as it offers convenience, speed, and security for various in-vehicle transactions, such as toll payments, parking fees, fuel purchases, and other services. QR codes allow users to make payments by scanning codes displayed on their smartphones, while RFID (Radio-Frequency Identification) enables contactless transactions through tags or cards. The adoption of these technologies is driven by the growing demand for seamless and efficient payment solutions, the increasing penetration of smartphones, and the widespread availability of NFC-enabled devices.

Credit/Debit Card Based segment in In-Vehicle Payment Services involves the use of credit or debit cards to facilitate transactions directly within vehicles. The integration of payment terminals or systems that accept card payments directly in vehicles offers convenience and enhances the user experience by streamlining transactions. This has made this sector popular because of the wide acceptance of card payments, the ease of use, and the assurance of a secure and efficient solution for making payments by drivers.

Based on the Application

Parking segment contains technologies and services developed to make a parking experience hassle-free for any driver, by integrating payment options within the vehicle itself. Some of the innovations in this space include automated payment of parking fees, whereby drivers could pay for parking without interacting with traditional payment machines. Advanced systems often incorporate mobile applications, in-car payment technologies, and license plate recognition for seamless transactions.

Gas Stations & Charging Stations segment comprises technologies and systems that help in seamless transactions at gas stations for conventional vehicles and charging stations for electric vehicles. Products it offers in this segment include contactless payment, mobile wallets, and integrated payment terminals, all helping to refuel and recharge more easily and quickly. As the adoption of electric vehicles accelerates and the demand for more efficient refuelling and charging experiences grows, this market segment is poised for significant expansion.

Food and Coffee segment includes a range of offerings such as in-vehicle ordering systems, integrated coffee, and food delivery services that can be accessed through vehicle infotainment systems or mobile apps. These solutions are aimed at enhancing the travel experience by providing convenience and improving the accessibility of food and beverages during journeys. As consumer expectations for comfort and convenience continue to rise, automakers and service providers are increasingly focusing on integrating such amenities into their vehicles to offer a more enjoyable and personalized travel experience.

Toll Collection segment encompasses various systems and technologies, including electronic toll collection (ETC) systems, which use RFID or DSRC (Dedicated Short-Range Communications) to automatically charge tolls to a pre-registered account as vehicles pass through toll booths or gantries. The integration of such systems offers convenience to drivers by eliminating the need for cash transactions or manual toll booth stops, thereby reducing traffic congestion and improving the efficiency of toll collection processes. This segment is driven by the advancement of communication technologies, increasing adoption of connected vehicles, and growing needs for seamless and automatic payment solutions in transportation infrastructure.

Recent Developments