A comprehensive overview of the cards, payments and merchant acquirer market in the United States, with clearsighted commentary backed by in-depth data.
The USA's point-of-sale is on the cusp of a revolution, as over half of debit and credit cards should be contactless-enabled by mid-2021. Other changes are happening in less tangible realms: the Fed is developing a new real-time payments network, intended, among other things, to prise consumers away from their beloved cheque books. Rewards competition may be peaking, but the US cards industry remains buoyant and is experiencing profits to match. Zelle and Venmo are making mobile P2P payments popular, particularly among younger segments. US merchants are looking for simple but powerful solutions, leading to integrated payments systems driving growth in merchant acquiring.
Demographics and the economy
Americans are keen consumers of electronic products to the extent that smartphone penetration reached 80 smartphones per 100 inhabitants at the end of 2018.
The US remains by far the most profitable payment cards market in the world and, among payment cards, credit cards are the most popular transactional instrument: over 55% of total purchase volume by card during 2019 was carried out using credit cards.
The US payment cards market enjoys great consumer penetration and merchant acceptance. The average adult made almost 500 card purchases in 2018, placing American consumers among the most active card users in the world.
Adoption of mobile payments in the United States has been slow compared to that seen in other developed markets, even though around 80% of Americans owned a smartphone at the end of 2019.
Credit cards continue to be a big revenue driver for American banks. According to VFR's profit pool model, pre-tax profits reached $35 billion in 2019. This equates to around one-third of global credit card profits.
The card networks
A quartet of networks – Visa, Mastercard, American Express and Discover – control the credit cards market . . . with Visa and Mastercard as the dominant players. Visa is the leading network in terms of both the number of cards and billed volume . . . Merchants are more willing to accept PIN debit cards because they are charged a lower fee for such transactions, as they are routed directly through the automated electronic funds transfer (EFT) system.
Key retail banks and issuers
A small number of large banks hold a commanding position in the retail banking sector, most notably JPMorgan Chase, Bank of America, Wells Fargo and Citibank. However, there is a long tail of smaller competitors, including regional and specialist players, ensuring healthy competition.
Acquiring and processing
The American merchant acquiring market is a highly attractive and profitable one. Although regulations have been put in place to reduce debit card interchange fees, credit card MSCs remain unregulated.
The e-commerce market in the United States has remained strong, increasing by double-digit percentage rates throughout the period under review.
Regulatory and other cards market information
Financial services companies are subject to regulation at both the state and federal level. The sector is subject to federal consumer protection, anti-money laundering conditions and various state licensing, safety and consumer protection requirements.
Appendices: United States Card Payments Data
Appendix I: Demographics and the economy
Appendix II: Payments environment
Appendix III: Cards market
Appendix IV: Mobile payments
Appendix V: Profit pool
Appendix VI: The card networks
Appendix VII: Key retail banks and issuers
Appendix VIII: Acquiring and processing
Appendix IX: Online acquiring
Acce Active Network Advent International Alipay Alliance Data Amazon Amazon Pay Amazon Payments American Express Android Pay Apple Apple Card Apple Pay Authorize.Net Bain Capital BAMS Bank of America Bank of America Merchant Services Bank of Delaware Bank of Italy BankAmerica BankAmericard Bankcorp Bank Barclaycard BB&T BBVA Compass Best Buy Blackhawk Network Bluebird BluePay BofA BofA Merchant Services Braintree Capital One CARD Act CardConnect Cayan CFPB Chase Chase Merchant Services Chase Pay Chevron Chime Citi Citi Retail Services Citibank Citigroup City Bank of New York Coca-Cola Consumer Financial Protection Bureau Costco Crédit Mutuel Arkéa CU24 Culiance Current Cybersource Dean Witter, Discover & Co. Delta Diners Club Discover Bank Disney Dodd-Frank Act Durbin Amendment Early Warning Services Earthport eBay Elavon Ethereum Ethoca ExxonMobil Facebook Fed Federal Reserve FedNow FFMC Fidelity National Information Services Fifth Third Bank Financial Crimes Enforcement Network FinCEN First Data First Financial Management Corp First National City Bank of New York FIS Fiserv FraudSight GE Capital Retail Bank Global Payments Gmail Goldman Sachs Google Google Pay Google Wallet Green Dot Grubhub Heartland Payment Systems Hilton Home Depot IBM ICBA Interbank Card Association Interlink JC Penney Jeanie JPMorgan Chase La Banque Postale Libra MABA Macy's Maestro Master Charge Mastercard Microsoft Mid-America Bankcard Association Morgan Stanley N26 National Data Corporation National-BankAmericard NationsBank Navy Nets Netspend Nissan Nova Information Systems NYCE OakStone Financial OnDeck Orbital PayPal PayPros PaySimple Plaid PNC Bank PULSE Quorum RBS Realex Payments Regulation II Revolut Roostify Sage Samsung Pay Santander Sears Sezzle Shell SICOM Signet Financial Simple Square Cash Stanford Federal Credit Union STAR Starbucks Stockpile Stripe SunTrust Bank Synchrony Financial TCH TD Bank The Clearing House Transfast Transfirst TSYS U.S. Bancorp U.S. Bank U.S. Payments Forum United Airlines US Treasury USAA Vantiv Venmo Visa Vyze Walmart Wells Fargo Worldpay Zelle
Verisk Financial Research reports deliver market and competitor intelligence on payments cards, e-money, acquiring/processing, retail banking, and consumer credit in North America. Researchers use both primary and secondary source data and conduct in-depth interviews with senior industry executives and North American experts.
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