tl;dr
Australia’s e-commerce is projected to reach $55 billion in 2025, with digital payments accounting for 53% of all e-commerce transactions in 2024. Mobile wallets and buy now, pay later solutions saw significant growth. The sector is expected to grow at a CAGR of 6.5% over the next five years. The ri...
DIGITAL PAYMENTS PUSHES AUSTRALIA’S E-COMMERCE TO $55B IN 2025 Australia’s e-commerce is projected to grow at an 8% compound annual growth rate (CAGR) to hit $55 billion this year, with digital payments playing a key part in the growth, a new report says. The report by GlobalData revealed that in 2024, digital payments accounted for 53% of all e-commerce transactions in Australia, surpassing card payments and cash for the first time. Mobile wallets and buy now, pay later (BNPL) solutions saw the highest growth.
Data published by the central bank in December showed that Australians had made over 500 million payments through their mobile wallets, amounting to over $20 billion in October. Payment cards were the second most popular payment method with a 38.7% market share, with cash accounting for a paltry 3.1%. GlobalData projects that the sector will grow at a CAGR of 6.5% over the next five years to hit $70.3 billion by 2029, a 37% surge from $51.3 billion in 2024.
“This growth can be attributed to the availability of secure online payment tools, an increasing number of online shoppers, and the rise of online merchants and payment options,” commented GlobalData’s senior banking analyst Shivani Gupta.
The rise of digital payments is gradually pushing out cash usage in Australia. The country’s central bank conducts a study every three years on cash interest, and in the last study in 2022, Australians reported using cash in only 13% of transactions, down from 69% in 2007. Australian purchases transaction chart Digital asset payments are also gradually taking off in Australia. Most recently, Alchemy Pay obtained a license from the Australian Transaction Reports and Analysis Centre to provide digital assets on- and off-ramps.
The Reserve Bank is also exploring a digital dollar. However, like most developed economies, Australia is leaning towards a wholesale central bank digital currency (CBDC). In September 2024, RBA launched a three-year CBDC implementation project, Project Acacia, that includes tokenization and the development of a new CBDC settlement infrastructure.
In other CBDC news, Papua New Guinea has completed a trial for its digital kina, which involved instant payments and cross-border transfers. The Bank of Papua New Guinea partnered with the Japanese Ministry of Economy, Trade and Industry and Japan’s blockchain market leader Soramitsu for the trial. In addition to enhancing efficiency and boosting financial inclusion, the central bank said it would also use the CBDC to crack down on financial crime.
In partnering with Soramitsu, Papua New Guinea tapped into the Japanese firm’s vast experience in digital currencies and its turnkey CBDC solution, which other Pacific island nations have leveraged. “Soramitsu is dedicated to modernising and advancing Papua New Guinea’s financial system while fostering the development of a digital economy. With the support of the Japanese government, we aim to leverage cutting-edge blockchain technology, proven in various countries, to make a meaningful contribution to this mission,” commented Soramitsu Japan’s president, Kazumasa Miyazawa.