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Are EV charging stations the next big market for payments? They will be if current trends hold up. And signs so far indicate the time to look into this market may be now, before more processors start crowding in.
Take the sheer number of EV charging points, or chargers. PriceWaterHouse Coopers recently forecast that the number of chargers in the U.S. market will swell from roughly 4 million to some 35 million by 2030. Meanwhile, EV car sales reached 438,000 in the third quarter last year, up 30% year-over-year.
Numbers like that may invite more interest from payments players that can provide card readers for those chargers. Some have already acted to get a share of the transaction potential. Take Nayax Ltd., an Israel-based company with a specialty in self-service payments. Last month, our correspondent Peter Lucas reported Nayax’s deal with Autel Energy, a provider of EV chargers, that will see Nayax embedding payments capability into about 100,000 chargers Autel plans to install throughout North America this year.
The Autel deal followed close on the heels of Nayax’s announcement in December that it had acquired Lynkwell, a U.S.-based technology developer for electric-vehicle charging stations. The $25.9-million, all-cash deal comes as Nayax looks to capitalize on the growth of EV charging as a payments market, particularly in the United States.
Schenectady, N.Y.-based Lynkwell posted $17.1 million in revenue last year, Nayax reported, representing what it called “substantial year-over-year growth.”
Some caution is called for. At 6.2 million, the total number of EVs on the road in the U.S. still represents just 2% of all vehicles.
But developments so far promise a “highly competitive” market for EV charging, notes Cliff Gray, proprietor at Gray Consulting, a payments advisory. “It’s a highly specialized vertical. The higher the average ticket, the better.” The market is likely subject to a low fraud rate, he adds.
Nayax has already embedded its payments technology in “a range of EV charging equipment,” the company says, a move it says Lynkwell can build on with artificial intelligence to optimize operations. The deal is also expected to benefit from strengths Lynkwell has already developed in conventional fueling for trucking fleets.
Nor is Nayax driving down a dead-end road. WEX, a Portland, Maine-based processor, announced in September it had signed a partnership deal with the company, along with two others, to expand its reach in that market.
And in August last year, EV Connect, a business-service provider for EV stations, said it would work with the payments provider BlueSnap Inc. to offer payment processing to station operators.
For now, the market is wide open. How long will that last?
—John Stewart, Editor john@digitaltransactions.net
