A study published by Juniper Research has found that revenue from tokenisation provisioning and management in mobile payments will exceed $53billion in 2025, from $18billion in 2020.
The report found tokenisation, where account details are replaced with data useless to fraudsters, is taking hold in both in-store and remote commerce. This growth of over 180%, will be fuelled by increased use of OEM Pays in both in-store and remote commerce, as well as increasing adoption of tokenisation by digital wallet providers and their tighter integration into app checkout processes. The research recommends that digital wallet providers move to implement tokenisation immediately, if not already, and prioritise acceptance to increase security in checkout processes.
Remote commerce to account for the majority of tokenisation revenue,
The new research, ‘Mobile Payment Data Protection: Tokenisation, Encryption and Market Forecasts 2021-2025’, found that revenue from remote payment tokenisation will equate to 58% of total mobile payment tokenisation revenue in 2025. However, this compares with 84% in 2020. As mobile contactless payments are tokenised by default, accompanying tokenisation revenue is accelerating rapidly, with contactless enjoying boosted growth following the pandemic.
Research co-author Susan Morrow explains: ‘Tokenisation is quickly becoming ubiquitous for mobile payments; reflecting the need for mobile payments to offer superior security features. Tokenisation vendors must offer simple and compliant token provisioning and management solutions, in order to capitalise on the rapid growth in mobile payments usage.’
The research also found that the use of persistent tokens is increasing in remote payments; accounting for 52% of tokenised remote mobile payment transactions in 2025, from 41% in 2020. The report identified that the increasing dominance of digital wallets that use persistent tokens in e-commerce is driving this growth. As such, the report recommends that tokenisation vendors focus on token management systems to ensure that managing persistent tokens is as efficient as possible.