Global E-commerce Market Expected to Reach $8.5 Trillion by 2026-Report

Steady Growth Projected with a Compound Annual Growth Rate of 9%

The global e-commerce market is anticipated to witness significant growth in the coming years, according to the Global Payments Report 2023 published by fintech company FIS. The report highlights that the market is expected to grow at a compound annual growth rate (CAGR) of 9% during the period of 2022-2026, with transactions value surging from approximately $6 trillion in 2022 to over $8.5 trillion in 2026.

Shift in Consumer Behavior Drives E-commerce Growth

The COVID-19 pandemic brought about a substantial shift in consumer behavior, leading to a surge in online shopping and digital payments. The report emphasizes that the explosive growth witnessed in global e-commerce during the initial phase of the pandemic has slightly slowed in 2022, with a 10% year-on-year growth in global e-commerce transaction value from 2021 to 2022.

Nevertheless, despite reduced growth rates compared to the early pandemic period, the forecast for the global e-commerce market remains optimistic.

Double-Digit Growth in Most Regions, Emerging Markets Show Promise

During the period of 2021-2022, all regions, except Europe, experienced double-digit growth in e-commerce. The Middle East and Africa exhibited the highest growth rate of 21%, while 37 out of 40 markets analyzed saw double-digit year-on-year growth. Latin America, the Middle East, Africa, and Southeast Asia, with the exception of Thailand, emerged as high-growth markets. The report predicts a mid-teens CAGR in these regions through 2026.

Opportunities in Cross-Border E-commerce and the Need for Capabilities

The projected growth in global e-commerce presents appealing opportunities for cross-border trade. The report advises businesses to develop cross-border e-commerce capabilities to capitalize on the high-growth markets. With robust double-digit growth forecasted in emerging markets, businesses can leverage these markets to expand their reach and customer base.

Addressing Challenges for Sustainable Growth

While the prospects for the global e-commerce market are promising, certain challenges must be addressed to ensure sustained growth. The report highlights the lack of digital infrastructure and financial inclusion in some emerging markets, which can hinder the growth of e-commerce. Additionally, regulatory challenges and cross-border trade barriers pose obstacles for businesses aiming to expand globally. Addressing these challenges will be crucial for unlocking the full potential of the global e-commerce market.

Some relevant and latest facts for the news:

• The global e-commerce market is currently worth around $6 trillion.

• The market is expected to grow at a CAGR of 9% from 2022 to 2026.

• Emerging markets are expected to see the fastest growth, with a CAGR of 11%.

• The growth of e-commerce is being driven by a number of factors, including the increasing popularity of online shopping, the growth of digital payments, and the expansion of e-commerce into new markets.

• The challenges to growth include the lack of digital infrastructure in some emerging markets, the lack of financial inclusion, and regulatory challenges.

• The growth of e-commerce in emerging markets presents attractive opportunities for cross-border e-commerce.

Here are some additional facts that you may find relevant:

• The Asia-Pacific region is expected to be the largest e-commerce market by 2026, accounting for over 40% of the global market.

• China is the largest e-commerce market in the world, followed by the United States and the United Kingdom.

• The most popular categories for online shopping include apparel, electronics, and home goods.

• Digital payments are becoming increasingly popular for e-commerce transactions.

• The growth of e-commerce is having a significant impact on the retail industry.

Conclusion

The Global Payments Report 2023 paints an optimistic picture of the global e-commerce market, projecting substantial growth in the coming years. The shift in consumer behavior towards online shopping and digital payments, triggered by the pandemic, continues to drive e-commerce growth.

Emerging markets offer attractive opportunities for cross-border e-commerce, but challenges related to digital infrastructure, financial inclusion, and regulatory barriers need tobe addressed for sustainable growth.

By developing cross-border e-commerce capabilities and overcoming these challenges, businesses can tap into the high-growth markets and expand their global presence.

The projected growth of the global e-commerce market emphasizes the importance of adapting to the evolving digital landscape and harnessing the potential of online transactions.