U.S. Merchant Acquiring Still Growing as Ecommerce Slows, Says Report

Saturday, April 23rd, 2022

According to the latest reports, the biggest 25 U.S. merchant acquirers currently control about 90% of payment dollar volume. Still holding on strong, even though eCommerce is said to be losing some of its massive momentum accumulated over the last two years. 

The 2022 Directory of U.S. Merchant Acquirers found that U.S. acquirers processed more than $9 trillion in payment volume last year. At the helm was JPMorgan Chase, with $1.89 trillion in volume. The annual report dove deeper, revealing that an estimated $6 trillion in volume was concentrated among the five biggest processors. 

A new release by Strawhecker about the report explained that this is due to “All…of these players have a strong bank sales channel, as they are either bank-owned or have an exceedingly large set of bank partners/clients from other areas of their business.”

That being said, big names aren’t the only ones hitting higher levels of volume. Fast-growing upstarts are also among the group. Block Inc. (formerly Square) and Stripe Inc., are both getting close to the top 10 (both of these companies were founded within the last 14 years). Another example, Ayden NV, recently founded in 2006, was an early player in what is now a booming market for buy now and pay later.

E-commerce Growth is Set to Slow

While the numbers are incredibly impressive, experts are saying that this heightened growth rate is now on track to slow down. Much of the massive growth rate is attributed to the COVID pandemic. Now that things are returning to some version of “normal” and restrictions ease considerably, this sector is showing signs of slowing down.

Meanwhile, some major eCommerce processors have managed to shrug off the de-acceleration and push forward. Embracing new trends and staying up-to-speed on consumer preferences.

“While the recent slowing of e-commerce growth has especially affected high-growth payment entities on Wall Street in the cases of companies such as Shopify and PayPal, these entities still grew at much higher rates than legacy incumbents from a payment-volume perspective,” Strawhecker’s release says.

As new processes and capabilities emerge, it will be interesting to see where the sector goes from here. While the explosive growth might be slowing, the pandemic without a doubt pushed great changes and innovative ideas that will unfold and grow for years to come.