In-car payments may see boost from Hyundai Pay launch

Article by Grace Broadbent | Sep 8, 2023

The news: Hyundai launched an in-vehicle payments system called Hyundai Pay, per a press release.

It lets drivers find and pay for things within their vehicle's touchscreen using stored credit card information.
The system is rolling out with the 2024 Hyundai Kona this fall before being added to nine other models.
Hyundai Pay’s first partnership is with Parkopedia to launch a parking payment system that lets customers reserve and pay for parking at 6,000 locations.

The bigger picture: Hyundai joins a growing list of carmakers and payments companies investing in in-car payments.

Mercedes-Benz debuted Mercedes Pay in 2018 and has ramped up its payments capabilities, launching biometric authentication through a tie-up with Visa and also partnering with Parkopedia this summer.
Stripe partnered with BMW in January to power payments made from BMW’s ConnectedDrive Store.
Apple expanded CarPlay’s payment capabilities through partnerships with quick-service restaurants like Panera and Domino’s and with Chevron.
And JPMorgan acquired 75% of Volkswagen Payments in 2021.

How it benefits Hyundai: Turning a car into a payment method can give automakers competitive advantages.

In-car payments let drivers conveniently conduct fuel payments, parking payments, and food and drink orders.
It can also make these transactions safer by limiting the functionality to things like saved orders and hands-free calling. This can reduce distracted driving compared with trying to navigate a mobile app behind the wheel.
And in addition to improving the driver experience, which can attract more customers, it also gives carmakers a new revenue stream and access to the valuable payments market.

Why it matters for payments providers: Payment providers want to capitalize on the booming in-car payments market, especially as more automakers make these payments accessible to consumers.

We expect 151.4 million people will drive connected cars this year, per our forecast. Of those, 45.5 million drivers will use Apple CarPlay—edging out Android Auto users, at 29.9 million.
And as connected cars grow, so will car payments: the connected-vehicle payments industry will reach $600 billion by 2030, per consulting firm Ptolemus.