Commentary

Surging digital payments to drive self-checkout market in 2022 and beyond

Increasing investments towards developing a robust infrastructure along with the flourishing travel and tourism trade will boost product adoption in the coming years.

Image courtesy of Global Market Insights Pvt. Ltd.

August 15, 2022 by Pooja Sharma — Senior Content Writer, Global Market Insights Pvt. Ltd.

The global self-checkout market share will increase substantially over the next few years. The leading factors backing the industry growth are the rapid expansion of digital infrastructure and the increasing construction of commercial and recreational spaces. The ongoing improvement in workers' minimum wages has significantly increased their access to banking facilities and instruments like credit/debit cards and mobile wallets.

In March 2022, the government of Canada announced the federal minimum wage to rise to $15.55 per hour from $15 per hour, effective April 2022.

Such developments, coupled with the increasing demand for fast checkout and cashless transaction facilities, will substantially boost the industry landscape in the years to come.

The self-checkout industry suffered several disruptions due to the COVID-19 outbreak. The imposition of lockdowns resulted in the temporary closure of commercial and public spaces and movement restrictions, hampering market growth. However, a subsequent rise in digital and cashless transactions due to increased anxiety related to viral transmission and the growing adoption of online services spurred product demand.

Proliferating tourism sector

Though the pandemic took a toll on the global travel and tourism industry, the escalating vaccination drives, rising disposable incomes, the ever-increasing desire to travel and explore outdoors and lockdown restrictions cross several economies have helped the industry to make a steady recovery over the recent months.

Based on the latest estimates by the World Travel and Tourism Council, the travel and tourism sector contributed as much as $1 trillion in 2021, registering a growth of almost 22% from 2020. The GDP share rose from around 5% in 2020 to nearly 6% in 2021. Further, the industry witnessed a growth of over 31% in visitor spending.

These optimistic scenarios have created a pool of opportunities for infrastructure development across both prosperous and emerging economies, which, in turn, may augment the self-checkout market trends in the coming years.

Increasing investments in infrastructure

Infrastructure improvements are critical to boosting growth, reducing inequality, enhancing economic standards and increasing service efficiency across economies.

Driven by these factors, in May 2022, the OPEC Fund for International Development signed a loan worth $25 million with the Inter-American Corp. for infrastructure financing with an intent to sponsor the expansion of private sector infrastructure schemes in the Latin America and Caribbean region. The projects will improve the quality of life for residents across the region while enhancing sectors like transport, water, sanitation and telecommunications.

The infusion of more such investments will substantially strengthen the self-checkout industry outlook.

Increasing digital payments

Digital payments and cashless transactions reached their apex during the pandemic. People were inclined towards online payment instruments due to their ease of use, convenience and enhanced payment security.

In June 2022, as part of its effort to digitally stimulate small and medium businesses in India, Amazon India announced that over 8.5 million small and medium size business entrepreneurs in the country benefitted through its digital payment infrastructure, Amazon Pay.

In the same month, Flexa, a digital payments firm, announced the acquisition of Drop Party, a marketing technology enterprise, to engage with customers through online campaigns by integrating the latest technologies like instant digital payments, non-fungible tokens and loyalty platforms.

Such developments are likely to fuel the self-checkout market trends in the times to come.

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