In-car payments will skyrocket as more and more drivers can use their cars to pay for parking and even fast food

The car payments market is expected to exceed £434 billion by 2030, according to a bold new market study.

In-car payments allow drivers to automatically and securely make transactions through the vehicle’s software, without the need for cards or smartphone payment systems.

At the same time, the number of connected vehicles on the road worldwide is expected to reach nearly 900 million.

Nowadays, your car doesn’t just get you from A to B. Connected vehicles are now a wallet on wheels.

Your car’s technology allows you to automatically and securely pay for a wide range of goods and services, including road insurance, parking, food and drinks or even entertainment.

Drivers don’t need cars or even mobile apps; the car’s software automatically pays for you.

Pairpoint, together with STL Partners and in collaboration with Vodafone, has analyzed the massive growth in in-car payments that is expected to take place by the end of this decade. A fuel for the future: the ability to pay $580 billion in cars.

Pairpoint has predicted that the global in-car transactional payments market will be worth £434 billion ($580 billion) by 2030.

That brings the compound annual growth rate to 130 percent in just a seven-year period between 2023 and 2030.

At the same time, the global connected vehicle market is expected to grow from 430 million to 895 million vehicles.

“Advanced connectivity is a catalyst for new ways of interacting with modern vehicles.

“Adding native payment functionality will enable more secure, real-time, automatic use of everyday services such as parking, EV charging, refueling and more,” said Jorge Bento, CEO of Pairpoint.

EVs have been a huge pioneer in this area and have rapidly accelerated the growth of in-car payments as the technology used for EV charging has transformed the industry.

Although in-car payments entered the mass market in 2018, the industry faced challenges in creating a seamless and secure experience.

But Pairpoint has noted that recent developments in biometric authentication, AI, blockchain and cloud tokenization have accelerated the adoption of in-car payments, and drivers can now use in-car payments in a highly secure and frictionless way, which enables a better user experience than traditional. card payments.

Mastercard’s Joseph Losavio said: “The automotive industry is moving from a purely physical asset to a connected device that enables payments across the ecosystem.”

What are car payments?

In-car payments are defined as: ‘The ability to purchase products or services from the car, with the car itself acting as the authenticator of the payment to create a frictionless experience for the consumer’.

Vehicle-related payments

These are maintenance and operational costs such as charging or parking, refueling or even automatic toll collection.

STL estimates that vehicle-related payments will account for 70 percent of total in-car payment options

Non-vehicle related payments

These are e-commerce transactions that turn your car into a mobile shopping platform; everything from entertainment subscriptions like Netflix to buying your groceries or ordering fast food.

STL estimates that non-vehicle payments will account for 25 percent of total in-car payment options

Software updates on request

We recently discussed in more detail what over-the-air software updates are and how they work.

Basically, over-the-air updates are software downloads that update your car overnight, in a similar way to how a smartphone updates while you sleep.

On-demand software updates are the third in-car payment category – additional in-car upgrades such as heated seats and adaptive cruise control – as many of these require additional money, i.e. they don’t come as free OTA.

More and more manufacturers are asking drivers to pay for additional features via OTAs.

STL estimates that non-vehicle payments will account for 5 percent of total in-car payment options.