Hungary in Early Stages of Embracing Fintech
Hungary had an estimated population of 9,660,351 as of the middle of 2020, according to UN data. Based on Worldometer elaboration of the latest UN data, Hungary had a population of 9,646,173 as of January 20, 2021, with 71.7% living in urban areas, mainly Budapest. The median age of the population is 43.3 years. Hungary's online population grew to 7.75 million by the end of 2019 from 7.5 million in 2018, according to the PPRO WECE Report.
The high levels of internet and smartphone penetration make Hungary a well-established market for e-commerce. According to JPMorgan, sophisticated consumers who are well versed in online shopping are a key feature of Hungary’s e-commerce market. The average annual revenue per paying user increased to $525 by the end of 2020 from $451.34 in 2019, according to the PPRO WECE Report. Meanwhile, ecommercenews.eu estimated that Hungary’s e-commerce market was worth €2.2 billion in 2019. Most cross-border e-commerce purchases by Hungarians are of products from China, the United States and Germany.
Most Hungarian shoppers prefer to pay with cash (45 percent), followed by e-wallets, bank transfers, cards, and other payment methods. For cashless payments, the major players are Visa, Mastercard and American Express.
According to IMF data, Hungary had a gross domestic product of $160.96 billion in 2019, which declined to $149.94 billion in 2020 due to the pandemic. As the economy continues to recover, Hungary’s GDP is expected to expand to about $171.75 billion in 2021.
Internet & mobile phone trends
According to Statista, almost all Hungarians aged 15-24 had internet access as of the fourth quarter of 2019, while 71% of those aged 50-69 went online regularly. According to Datareportal, there were 7.64 million internet users in January 2020, having decreased by about 19,000 (-0.2 percent) from 2019 with an internet penetration rate of 79%. Meanwhile, smartphone penetration increased to 65% at the end of 2019 from 55% in 2018, according to the PPRO WECE Report.
According to data compiled by learnbonds.com, 62.33% of Hungarians had bank accounts in 2019, with only 13% of them credit card holders.