Despite digital wallets making big inroads in the Australian retail payments market, the offerings of wallet providers remain “narrow and generic”, according to payments industry leaders. Worldpay, a subsidiary of global payments company FIS, released its 2023 Global Payments Report yesterday, revealing that 31 per cent of e-commerce payments in Australia in 2022 were made with a digital wallet.  According to the report, 28 per cent of e-commerce payments were made with credit cards, 14 per cent with a buy now pay later service and 13 per cent with debit cards. It is the first time digital wallets have been the leading online payment method. At the point of sale, 40 per cent of payments were made with debit cards, 33 per cent with credit cards, 12 per cent with digital wallets, 7 per cent with point-of-sale finance, 6 per cent with cash and 2 per cent with a pre-paid card. Use of digital wallets was the fastest growing point of sale payment method last year. Adrian Lovney, chief payments and schemes officer at Australian Payments Plus said digital wallet providers operating in Australia offer consumers an “undifferentiated experience”, which is usually no more than facilitating a debit or credit transaction on a mobile device. Speaking at a briefing to launch the Worldpay report, Lovney said there was more competition and more innovation in other Asia Pacific markets. In March, AP+ announced a strategic partnership with Coles to develop a bespoke digital wallet that will use QR code technology. Lovney said a tailored digital wallet offering could include integrated loyalty programs, digital receipts, shopping offers and post-purchase services such as warranties. He said he welcomed the government’s plan to give the Reserve Bank greater regulatory power over digital wallet providers, which could open up the market to new entrants and service providers. Another speaker at the briefing, Mastercard senior vice president Surin Fernando, agreed that there was scope for digital wallet providers to add value for consumers and retailers. While the report shows that the use of BNPL has increased greatly in Australia in recent years, Worldpay says its share of e-commerce payments is unlikely to grow further over the next few years. Worldpay general manager for Asia Pacific, Phil Pomford, said: “BNPL has established itself as a key payment method in the Australian market. While headwinds including rising inflation and interest rates are challenging BNPL’s core fundamentals, consumers’ interest in alternative credit remains high. We see BNPL holding market share in years to come.”