By W.B. King
Topping Juniper Research’s Top 10 Fintech & Payments Trends 2025 is “Apple NFC to Boost Competition in Digital Wallets.” The report notes that with Android devices, access to near field communication (NFC) by non-OEM (original equipment manufacturer) wallets is unrestricted, which means that any developer can use NFC capability for payments.
According to report research, Apple, conversely, has always represented a closed ecosystem for NFC payments.
“This has long been challenging for regulators, particularly in Europe. In December 2023, Apple was rumored to be offering to open up NFC access within the EU to address regulatory concerns, with it being confirmed in July 2024 that the EU had accepted Apple’s offer, reaching an agreement to open up NFC access within the EU, free of charge to developers/third parties,” the report continued.
“In August 2024, Apple announced that it was widening this access significantly by enabling third parties to offer NFC payments on iPhone outside the EU market. This rollout initially covers Australia, Brazil, Canada, Japan, New Zealand, the UK, and the U.S., with further locations to follow.”
Consequently, the digital wallet “status quo” is being disrupted. “We predict that this move will create a race for innovation within the digital wallets market, with 2025 witnessing a level of competition that has not been seen in recent times.”
The report noted three leading reasons for this stance:
Expansion of Existing Wallet Capabilities: For existing digital wallet services, this can facilitate new expansions. For example, PayPal has already stated that it intends to take advantage of this development to offer in-store NFC on iPhones. This enables wallet services that were previously not in-store players to move in this direction. Additionally, it could enable the disassociation of wallets with devices. At present, the Samsung and Google wallets are used within their ecosystems, but they could both be adopted for iPhones, breaking the link between the wallet and the ecosystem surrounding it.”
Existing Apps Becoming Wallets: “Outside of existing wallet apps, there are many apps with different purposes which can then potentially move into the wallets space. One example is existing credit card providers, who will be able to create a branded wallet for use with their credit card in person. Another example is a cryptocurrency exchange or service, potentially creating a wallet to allow cryptocurrency payments at point of sale. Beyond this, there are options within the retail market. Many large retailers, such as Walmart, Tesco, and Starbucks have their own payment systems, which are typically QR code-based. Retailers could port these systems to use the NFC capability, shifting payments from closed to open loop. Consequently, this would significantly increase the competition in the market.”
Bank-backed Wallets: “Banks have often had different approaches to the wallets market, with some historically trying to launch their own issuer-specific wallet services. The dominant role of OEM wallets has seriously restricted the growth of this category, but the opening up of NFC gives this market another opportunity. For banks and other card issuers, they would be able to keep the customer deeper within their own ecosystem, and potentially generate additional revenue, or at least retain revenue that they already lose to third-party wallet services.”
While the report stated that not all noted changes will occur in 2025, financial institutions across the board will see an increase in competition in the digital payments ecosystem. To date, the Far East and China have the largest population using digital wallets (just under 90%), followed by Western Europe and Northern America both hovering around 70%.
“We anticipate the biggest impacts to be within Western Europe and North America, where there is significant wallet penetration, but still room for new users to be brought within the ecosystem,” the report noted. “Fundamentally, we do not expect Apple to lose a large amount of market share by opening up its ecosystem – it has established a loyal customer base and has iterated its solutions regularly. However, in 2025, competition will intensify, creating a much more dynamic and innovative digital wallets market.”
Minimizing Industry Monopolies
Rounding out Juniper’s 2025 list were the following nine trends (in order of importance):
Virtual Cards to Revolutionize B2B Expenses and Procurement
Behavioral Biometrics Driving Shift to Passive ID Verification
eCommerce Merchants to Adopt ‘Glocal’ (global/local) Payments
Regtech to Accelerate Amid BaaS Compliance Challenges
Banks to Invest in PSD3 & PSR1 Readiness
Capital One’s Acquisition of Discover to Challenge Visa & Mastercard
Wero and Instant Payments Harmonization to Transform European Payments
AI Hype to Diminish as Fraud and Identity Drive Innovation
Sustainable Fintech Becomes Key Differentiator for Banks
“As the tricky economic climate continues, a focus on reducing costs and maximizing return on existing investment is a key priority for success. We anticipate that these economic pressures will be a major priority for stakeholders and will drive a number of key trends discussed here, including minimizing industry monopolies, financially inclusive initiatives, and ensuring protections are ahead of the game,” the report continued.
“It is clear that fintech and payments markets are undergoing significant changes. From the methods consumers and merchants use to secure their finances, the way regulations are impacting the wider market, and the directions companies are taking to maintain consumer loyalty, payment preferences and financial technologies are changing quickly in different markets, all across the world, for market stakeholders and consumers alike.”