Latest ETA Market Research Report Shows Robust Payments Industry Growth
The Electronic Transactions Association (ETA), the trade association of the global electronic payments industry, today released its U.S. Economic Indicators Report for the second quarter of 2013. Published quarterly with analysis from The Strawhecker Group (TSG) for the benefit of ETA member companies, the 18th edition of the report shows the industry continued to outperform the traditional market sector during the second quarter.
Using proprietary data and analysis from TSG, ETA’s Economic Indicators Report surveys the state of the electronics payments industry alongside key macro- and microeconomic data points. Armed with this information, ETA members can judge how the payments industry performs in various economic climates and in comparison to major economic indicators.
TSG’s new industry metric, the Gross Value Profit Index (GPVI), shows the value of merchant portfolio revenue streams using data from the 1.6 million merchants, representing 20 percent of the U.S. brick and mortar merchant market. As of Q1 2013, these merchants had processed over $168 billion in annual volume. According to this latest report, the GVPI shows a growth rate (CAGR) of 16 percent since the fourth quarter of 2010.
“Today’s U.S. Economic Indicators Report shows the electronic payments industry continues in a steady growth pattern with merchant portfolios growing in response to new market opportunities,,” said Jason Oxman, chief executive officer of ETA. “The U.S. economy continues to recover, and trends in the electronic payments industry continue to look positive. ETA’s latest economic report provides ETA members a vital tool to assess their own position in the marketplace.”
The 18th edition of the report also examined the “disintermediation threat” posed by new entrants to the merchant acquiring industry. The threat appears to be limited to the smaller, non-specialized merchant market. In general, gross pricing is at nearly the same levels as it was in 2009, indicating very little price compression.
The report also tracks the performance of a $100 investment in 2007 in an index of select industry companies that represent the “TSG Payments Index” (TSGPX). In the second quarter of 2013, the TSGPX grew 14.8 percent from the first quarter of 2007. That is compared to just 1.9 percent growth in the same period in the S&P 500 index, one of the most commonly used benchmarks for the U.S. stock market. A $100 investment in the TSGPX in Q1 2007 would now be valued at $246, while the same investment in the S&P 500 would be valued at $113.
The report also includes a review of 80 industry enterprise and merchant portfolio transactions from 2000 – 2012. The review shows that net revenue multiple averages rebounded in 2012, after dropping following the recession.
This is the 18th edition of the ETA U.S. Economic Indicators Report, which is only available in full to ETA members. Companies interested in becoming members of ETA should contact Del Baker, ETA’s membership director, at [email protected] or 202-828-2635.
[divide]UPCOMING ETA EVENTS
International Acquiring Forum
Millennium Gloucester Hotel and Conference Center
London U.K.
September 17 – 19, 2013
2013 Strategic Leadership Forum
Montelucia Resort & Spa
Scottsdale, AZ
October 15 – 17, 2013
2014 ETA Annual Meeting & Expo
April 8-10, 2014
Mandalay Bay
Las Vegas, NV
ABOUT ETA
The Electronic Transactions Association is an international trade association representing more than 500 companies that offer electronic transaction processing products and services. ETA’s mission is to advance the payments industry profession by providing leadership through education, advocacy and the exchange of information.
For more information on ETA, contact Del Baker at [email protected].