Nordic Digital Payment Software Market - Forecasts from 2024 to 2029

The Nordic digital payment software market is estimated to experience a CAGR of 10.58% throughout the forecast period, reaching a market size of US$932.020 million by 2029, representing a significant increase from US$460.961 million recorded in 2022.

Digital payment software offers a cutting-edge technology landscape in the field of financial transactions within the Nordic countries, encompassing Denmark, Finland, Iceland, Norway, and Sweden. These solutions are designed to streamline and enhance the payment processes, offering secure, efficient, and convenient digital payment options to businesses and consumers alike. The Nordic region, known for its tech-savvy population and advanced digital infrastructure, has witnessed a surge in the adoption of digital payment software. These platforms facilitate various payment methods, including mobile payments, contactless transactions, and online banking, contributing to a cashless and digitally connected economy. The emphasis on security, innovation, and user-friendly interfaces underscores the significance of Nordic digital payment software in shaping the future of financial transactions across the region.

Rising adoption of online payment modes coupled with market developments propels the market

The landscape of consumer transactions and financial operations has been transformed by the advent of online payment and banking. This transformation has not only impacted on how individuals shop, make purchases, and settle payments but has also brought about a revolution in both the e-commerce and banking sectors. The Norwegian e-commerce industry, in particular, is experiencing rapid growth with the increasing number of businesses venturing into the online space. A key driving factor behind Norway's swift adoption of digital payments is the inherent convenience they offer. While physical currency remains relevant for small-value transactions, the ease and security associated with digital payment methods have contributed to a rising preference for digital transactions among Norwegians. In the 2022 survey conducted by the Swedish central bank, 2,089 individuals aged 18-84, selected randomly, participated in the Riksbank's questionnaire. Out of these, 1,589 respondents took part in web interviews, while 500 telephone interviews were conducted to include individuals who do not use the internet. The interviews were carried out from March 14 to March 30, 2022. According to the survey, 34% reported using cash for payments in the past month, marking a significant decline from the spring of 2020 when the corresponding figure was 50%. The trend away from cash payments had been ongoing for some time, with a notable drop from 79% in 2016 to 34% in 2022. Meanwhile, the use of Swish, a mobile payment service, has substantially increased, with over 80% reporting its usage in the last month compared to 52% in 2016. Swish is predominantly utilized for transactions between individuals or for online purchases, while physical store payments are infrequently made using Swish.

It is projected that the market in Sweden will grow steadily. 

The Nordic digital payment market is experiencing significant growth, primarily fueled by several key factors.

The Nordic digital payment sector is undergoing substantial growth, driven by various key factors. A pivotal catalyst is the initiative outlined in the Sweden FSAP 2022 report, wherein the Riksbank introduced the RIX-INST system in May. This system aims to facilitate instant payment settlement in central bank currency, aligning with the harmonization of Nordic payment markets toward a common European standard. Concurrently, major Nordic banks are collaborating on a unified infrastructure for payments. As of May 2022, the popular Swish platform boasted 8.6 million users, with a significant majority - 8.3 million - utilizing it for personal accounts. Additionally, 319,000 businesses have integrated Swish for payment services. Notably, the average transaction value during this period stood at SEK 481 (approximately US$48), indicating Swish's prevalence in facilitating lower-value daily transactions. The Riksbank's analysis reveals that the Swedish payment landscape is predominantly shaped by private payment methods. To boost market growth, the Riksbank advocates for the issuance of the e-krona as a public, universal alternative payment method. The introduction of the e-krona is expected to foster competition and enhance efficiency in the payments market. The central bank believes that allowing the private sector to leverage the e-krona for new services, such as data utilization or programmability of money, could further stimulate competition.

Furthermore, a survey conducted by the Riksbank in 2022 on the payment habits of the Swedish population highlights the persistence of digital payment trends accelerated by the pandemic. Almost all transactions are now conducted digitally, with increased online shopping and reduced reliance on cash. Notably, the percentage of individuals making digital payments through the Swish app rose from 70% in 2020 to 82% in 2022. This shift in payment behavior, coupled with collaborative efforts and policy changes, has created a burgeoning market opportunity in the region.

Market Key Developments

• June 2023, Nets Finland and Nexi Digital Finland, subsidiaries of the Nexi Group, launched Npay, aiming to offer merchants straightforward and adaptable cloud-based payment solutions. This initiative aligns with their commitment to local innovation and widespread distribution across Europe.
• October 2022, Danish company MobilePay revealed that the EU Commission granted approval for its merger with Norway-based Vipps. This consolidation aims to create a substantial Nordic and European mobile wallet, with the merged entity boasting approximately 11 million users, 400,000 merchants, and an annual transaction volume of 900 million.

Segmentation:

By Solution:

• Software
• Service

By Enterprise Size:

• Small
• Medium
• Large

By End-User industry:

• BFSI
• Retail
• Hospitality
• Media and Entertainment
• Government
• Others

By Geography

• Norway
• Sweden
• Denmark
• Finland
• Others