Que QR, QR (Whatever Will Be, Will Be)

Why and how QR codes are dominating payment initiation

May 22, 2025

As a management consultant my favourite task was to bring new ideas to clients. One such idea, way back in 2012 was mobile payments initiated by QR code1.

A PFM2 company had a prototype QR code payment system and had developed a working demo that screen scraped3 to pay from a mobile, by capturing a QR code on a website, self-service checkout or POS device. I took the demo with the PFM team around a number of UK banks. Branch banking was still dominant and with mobile banking its infancy, our demo was of little interest to bemused retail bank product owners.

However, bank technologists were keen and one bank in particular had an appetite to trial it with a merchant acquirer I had engaged. All that was required was to pitch it to the COO for funding and resources – the client’s technology team had prepared the ground, the COO was receptive and a meeting was in his diary to get his approval.

Then disaster struck.

The bank had a massive IT outage that affected millions of customers for weeks. It was a case of all-hands on deck across the bank at all levels to sort out the consequences. Needless to say, my meeting with the COO was cancelled, never to be rescheduled.

I can only guess at what might have been for UK payments. At the time it was a speculative proposition but QR code payments have since proved hugely popular in many countries. Given this, if our UK trial had gone ahead, its chances of success would have been high and with the right nurturing could have changed the face of UK retail payments today.

So much for hindsight. However, QR code-initiated payments go from strength to strength globally and have started appearing even in the UK, with open banking payments.

In this article, I explain the extent to which QR code-initiated payments are used worldwide, how they are used and why they are successful.

The Scale of QR Code Adoption for Payment Initiation

Table 1 shows countries where QR codes are used with digital wallets.

The table would benefit from further research on QR code in-person and online payment initiation volumes and other information such as regulatory requirements for merchant registration and interoperability of payment methods. For now, it illustrates the widespread use of QR codes to initiate payments.

Some countries do provide statistics showing QR code usage which demonstrate they are core to digital wallet usage for Account-to-Account (A2A) payments. One example is Brazil, where QR codes were used to initiate 27bn payments over the past 12 months through the Pix real-time payment system, valued at 2.4 trillion real (441bn USD). Figure 1 shows the Pix monthly payment volumes for QR code-initiated payments.

Figure 1 – QR code monthly volumes in Brazil (Pix)

2.6 bn or 47% of the 6bn monthly payments in Pix are initiated using QR codes (39% dynamic, 8% static), the remainder are initiated through aliases (41%) and manual input/direct entry of bank details (12%). Figure 1 shows that the static QR code usage is, well, static at just under 500m monthly payments, while the use of dynamic QR is growing.

Indonesia is another example. Data from QRIS4 in Indonesia show 2.3bn payments in 2024 initiated with QR codes, a 192% increase on 2023 and 8% of the total 28bn real-time payments transactions last year.

India publishes QR code user numbers. Figure 2 shows the number of UPI QR users has risen from 144m at the end of 2021 to 659m in March 2025. That is almost half the total population, indicating that UPI wallets are used widely in a cash-like manner for P2P payments and for small traders.

Figure 2 – Number of users in India for UPI QR codes

India also has Bharat QR for card transactions through banking apps but there are only 7m users (up from 5m at the end of 2021).

The high usage and growth of QR codes in these examples is likely to be repeated across many of the countries in Table 1. QR code use is widespread and a key driving force behind adoption of real-time A2A payments using digital wallets. China in particular has huge transaction volumes generated through non-bank digital wallets such as Alipay and WeChat Pay, 1.3 trillion payments per year, which make extensive use of QR codes.

How QR Codes are Used In Payments

The benefit of QR codes is they connect payers to payees easily. Either the payer scans the payee’s QR code to get their address to send payment, or the payee scans the payer’s QR code to send them a request for payment or to pull the funds automatically from the payer’s wallet.

This makes QR codes very flexible and workable in both in-person and on-line scenarios. For example, a merchant can display a dynamic QR code on a POS terminal, an in-store self-checkout and online using the same process and technology, unlike NFC (contactless) which works only between physical devices (in-store POS, card readers etc).

To see the simplicity of using QR codes payments in action, watch this delightful video clip of a digital wallet purchase for just 1 rupee (~10 cents) in India using the Google Pay wallet and UPI in India.

While the clip shows a customer scanning a static merchant QR code, there are other methods which vary depending on the digital wallet, as shown in Table 2.

Table 2 – ways to use QR codes with digital wallets

QR codes are also used in open banking online, but in a slightly different way. For example, in the UK a typical use is to fund a brokerage account from a bank account. In their online brokerage account the customer enters the amount they wish to deposit and selects their bank. The broker’s website displays a QR code on screen which the customer captures on their phone (natively with the camera) to connect automatically with their mobile bank to approve the payment.

With variable recurring payments likely in the UK and Europe for ecommerce, I expect that QR codes for open banking will expand enormously.

Success Factors

The mass adoption of QR codes in A2A payments with digital wallets is due to:

1. a strong product-market fit where QR codes are one component within a powerful combination of:

- payer-payee connectivity through QR codes, in-person and online

- mobile-first digital wallets that present and read QR codes

- A2A real-time payments that are initiated through QR codes.

2. Simplicity and consumer trust – scanning is quicker, easier and more accurate than entering payment details. Use of digital wallets limits fraud (see later section), leading consumers to trust digital wallets using QR codes – they are a convenient way to pay.

3. The two-way, cash-like consumer experience where, due to QR codes, consumers can receive payments in their digital wallets just as easily as making payments, enabling P2P payments and micro-merchant payments. In particular, it has enabled micro-merchants who in the past have lacked resources for POS terminals and card readers to accept card payments.

4. The very low-cost acceptance for micro-merchants – it costs nothing to generate a QR code within a wallet.

5. QR code standardisation, often through central bank regulation, particularly for interoperability of merchant-presented QR codes. Similar to a single POS terminal accepting multiple card brands and types, this standardisation allows merchants to present one QR code and accept payments from different wallet brands and payment methods (A2A, cards). Many national QR standards are based on the EMVco QR code standard5 (often with local variations).

6. Multi-channel flexibility – as well as on mobile phone screens, QR codes can be presented on any surface - paper, billboards, TV screens and most importantly on laptop/desktop screens for online payments and ecommerce.

7. Smartphone barriers – an alternative to QR codes is NFC for in-person payments. Although app developers have had access to NFC on Android phones since 2013, Apple has started only recently to allow developers NFC access, a restriction that has helped QR code-intiated payments to proliferate without competition. Building an app to use NFC is also more complex and costly than using QR codes.

QR Code Fraud

This section is to address a misconception that QR codes encourage fraud and are a security risk.

It is true QR codes are used for fraud but this occurs usually due to poor implementation when QR codes, printed on signs divert to websites to enter card details, such as for car parking. Obviously, this creates opportunities for phishing and fraudulent merchants when fraudulent QR codes are placed on top of legitimate ones.

However, within the controlled environment of a digital wallet this fraud risk is far lower. When a wallet is open, a scanned QR code is checked for a secret or digital signature. If missing or incorrect, the QR code is rejected. If the wallet is closed, on scanning the QR code natively, the user expects their default wallet to open. If this fails or if a website appears, the user knows the QR code is likely to be fraudulent.

Fraud is still possible by overlaying a legitimate wallet QR code over another6, but the wallet name is displayed (see earlier video clip) and the payer can see it is different to the expected name. Countries such as Brazil and India have regulations to prevent QR code fraud, for example requiring merchants with high payment volumes or values to register with regulators in order to generate QR codes and to generate them dynamically for every transaction. In Brazil, this is done by the merchant’s bank through an API.

I estimate around one trillion payments7 across Asia Pacific and Latin America were initiated using QR codes in 2024. These volumes would be impossible if QR codes were a fraud problem.

In India, 83%8 of domestic payments (28% by value) are through UPI wallets and continue to rise, as does the number of QR code users. However, the rate of fraudulent domestic payments as a percentage of total domestic payments is falling and is currently 0.0008%, as shown in Figure 3. This is further evidence that QR code fraud can be contained.

Figure 3 – India fraudulent domestic payments as a % total domestic payment volume

In comparison the percentage of fraudulent Faster Payments transactions in the UK where there are no A2A digital wallets is much higher at 0.01%9

Conclusion

QR codes generated and captured easily in digital wallets are integral to the rise and success of A2A real-time payments globally. A2A digital wallets have changed and expanded the payments landscape in Asia Pacific and Latin America, where combined, real-time payments volumes reached two trillion in 2024 (footnote 7). In Brazil, almost half of all real-time payments are initiated through QR codes and I suspect that the proportion in China is even higher.

In contrast, A2A digital wallets have been slow to take off in Europe and North America limiting QR code-initiated payments, due to the entrenched use of cards. Real-time payments in these regions lag as a result.

There is also a perception, especially in Europe, due to poor implementation, that QR codes are prone to fraud. When used within the controlled environment of a digital wallet, fraud can be limited, as proven by around one trillion successful QR code-initiated payments in 2024.

Digital wallets are taking hold in Europe – Bizum, Blik, Swish, Twint, Wero, Vipps to name a few. As their use increases, so will QR code-initiated A2A payments across the region, particularly through dynamic QR codes generated for every payment. The USA might even follow.

It is unlikely PCs will disappear any time soon from households or will have NFC capability, so the edge that QR codes have over NFC for ecommerce payments will endure.

Digital wallets have far greater adoption than open banking but both are drivers of QR code-initiated payments. It will be interesting to see if open banking QR code usage catches up with digital wallets or whether digital wallets will race further ahead.

The lyrics of the song that inspired the title of this article advise against predicting the future - what will be, will be. In 2012 we had no idea how QR code payments would be but they have turned out to be a huge success and driving force behind digital wallet A2A real time payments – long may they continue.

Agenda: Payments

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