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While the top 10 roster of the largest merchant acquirers in the TSG Directory of U.S. Merchant Acquirers shows little variation from last year—JPMorgan Chase & Co. is still No. 1 at $2.61 trillion in volume in 2024—smaller players are moving into the upper ranks.
Adyen NV, a Netherlands-based processor moved into the top 10 for the first time, “eclipsing Square (Block), which held that spot last year,” says Alex Ferguson, product manager at TSG, an Omaha, Neb.-based advisory firm that annually issues the directory. Adyen entered the U.S. market in 2010. Adyen processed an estimated $333.6 billion in volume in 2024. Square’s 2024 volume estimate is $187.2 billion.
“The most notable volume gainers were mostly the same movers as in prior years: Stripe, Adyen, and Toast,” Ferguson tells Digital Transactions News via email. “Stripe and Adyen’s growth primarily reflects their strength with enterprise merchants, who grow volumes at a much higher rate than [small and mid-size businesses] on a year-to-year basis.”
Ferguson says Toast tends to dominate the restaurant industry, “so its continued market growth isn’t surprising. It’ll be interesting to see where they take their newer focus on retail merchants.”
Square, with an estimated 4 million merchants, the most of any acquirer, poses an interesting analysis, Ferguson says. “Over the years, they’ve been thought of similarly with Adyen and Stripe as the pinnacle of emerging entrants and a common entity that ISOs are selling against. Still, their U.S. volume isn’t growing by the leaps and bounds of Stripe or Adyen,” he says.
That may be a reflection of its merchant mix. Though Square is shifting focus to upstream merchants with higher average annual volumes, many of their merchants are small and mid-size retail and restaurant merchants, he says. “Those segments’ volumes aren’t going to grow at the rate of the enterprise merchants that Adyen and Stripe are serving. Square continues to win and increase its market share abroad while pivoting towards subscription-based revenues recently.”
Overall, acquirers are facing a number of trends, particularly that growth in payment volume may be slowing after big growth during the Covid years.
“What is new and noteworthy is the continual gradual slowdown in payment volume,” Ferguson says. “Apart from 2020 and the 2021 post-COVID correction boom, U.S. payments volume generally has grown at a steady 9% YoY rate (2015-2019 9% CAGR, and a 2022 9% YoY growth rate from 2021). Last year was perhaps the first sign of slowing volume growth, at 7%, and this year, credit card volume growth from the payment networks is hovering around 4%-5%.”
Other factors include that the market is overall moving toward integrated and embedded services, more products geared to verticals, and consolidation, but, as Ferguson says, there are not necessarily new trends in 2024.
A third element is that the so-called legacy acquirers are not idle. “The industry has become increasingly competitive as incumbent legacy providers continue to develop and/or acquire smart POS and value-added offerings that allow them to compete with innovative entities of the ecosystem across all merchant mix sizes,” he says. Rounding out the top 10 merchant acquirers following Chase, are Fiserv Inc., Worldpay, Wells Fargo Merchant Services, Global Payments Inc., Stripe Inc., Bank of America Corp., Elavon, Braintree, and Adyen.
