Rapyd, a global fintech company, has released its 2020 Asia Pacific eCommerce and Payment Study that analysed the financial habits, payment methods, considerations and preferences of consumers in seven countries in the region.
The report, which was conducted in March and April 2020, uncovered how consumer buying expectations and behaviours are evolving in an increasingly digital world.
From 3,500 online consumers surveyed, the results showed a quick rise in new payment technologies that have emerged in recent years and gained rapid adoption and popularity by offering a convenient payment experience, adapting to the local context and providing access to digital payments for traditionally underbanked communities.
As buyers go increasingly cashless, the study hopes to help businesses gain insights into consumer buying habits and payment diversity in Asia, helping e-commerce and m-commerce businesses increase their addressable audience and include new customer segments into the Internet economy by adopting the most relevant digital payment options.
Joel Yarbrough, VP (Asia Pacific), Rapyd, said: “Since the beginning of the global pandemic, going digital is no longer optional. E-commerce is now the new baseline. All over Asia, we see stratospheric growth in digital payment methods, with local patterns and local winners in every country. With this report, Rapyd provides businesses with the local market insights on payment behaviors, brands of choice, and technologies that are critical in creating a relevant checkout experience for consumers today.”
Card-only merchants’ challenges
According to its findings, cards and card-powered mobile wallets are dominant in Japan (61 per cent) and Taiwan (51 per cent), with a dramatic uptake of e-wallets and bank transfers as preferred ways to pay.
Taken together, e-wallets and bank transfers represent the emerging wave of payments, particularly where they are enhanced by interoperable real-time payment (RTP) systems like India with UPI (64 per cent) and Thailand with PromptPay (62 per cent).
Even in a card-preferring market like Singapore, e-wallets and bank transfers including PayNow are preferred by 42 per cent of respondents, swinging all the way to 78 per cent in Indonesia.
These are the key findings for each country participating in the survey:
Singapore
- Real-time bank payments are on the rise with PayNow and FAST bank transfers leading amidst concerns about coronavirus, converging with several years of government investment.
- PayNow earned the number 2 spot among the top payment methods with 70 per cent of respondents using it in the last month.
- GrabPay is the third most popular payment method after credit cards and PayNow.
Indonesia
- OVO Wallet is the number one frequently-used payment method with 69 per cent respondents claiming to have used it in the past month and the country’s most preferred one with 17.8 per cent respondents choosing it amongst all payment brands.
- Indonesian consumers strongly prefer e-wallets to cards and cash with 33.8 per cent choosing one of three e-wallets (OVO, Go-Pay or Dana) as their preferred way to pay.
- Real-time bank transfers including both virtual accounts and older bank redirects are preferred 44 per cent of the time on the archipelago.
Malaysia
- Bank transfer by Maybank2U, owned by Maybank, the largest bank in the country, is the most popular online payment method by usage (65 per cent) and preference (21.4 per cent).
- E-wallets including Touch N Go, Boost, PayPal, and GrabPay are all of rising importance with 22 per cent respondents choosing them as their preferred payment methods.
- Cash on delivery remains relevant with 65 per cent users claiming to have done it in the past month, prior to the Movement Control Order (MCO).
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India
- 85 per cent of Indian respondents used Paytm in the last month.
- With the growth of India’s UPI payment scheme, e-wallets (including Paytm, Google Pay, Amazon Pay) are preferred by 51.2 per cent of users and bank transfers by 11.9 per cent.
- Debit and credit cards together are preceded by 28 per cent of respondents.
- 49 per cent of respondents make online purchases daily (highest among all countries surveyed).
Japan
- Most consumers still prefer credit cards and cash over the counter.
- Amongst mobile payment methods, PayPay eWallet is rapidly gaining popularity with 41 per cent users claiming to have used it in the past month, and 9.6 per cent choosing it over all other payment methods.
Taiwan
- Credit cards continue to be the top payment method in Taiwan both in terms of usage and preference.
- Consumers appear to use multiple payment types depending on the use case, with preferences split almost equally between credit cards, pay-on-pickup at convenience stores, bank transfers, local Easycard, and eWallets.
Thailand
- The TrueMoney e-wallet is the leading payment method with 66 per cent of respondents using it regularly, and 16.8 per cent choosing it over any other payment method.
- Together, e-wallets and bank transfers make up the most popular payment methods chosen by 62.2 per cent users — a trend accelerated by the interoperable PromptPay payment scheme.
- Cash is still preferred in highly digital Thailand by 19.4 per cent of respondents.
Altogether, it’s worth noting that e-commerce and mobile-commerce in the seven countries is worth some US$355 billion, as mentioned in the study. Southeast Asia’s internet economy hit US$100 billion in 2019 and is expected to grow to US$300 billion by 2025.
Consumers in the region and current situation continue to push businesses towards digitalisation and as digital adoption accelerates, it is essential for businesses to invest in the right technologies to build a strong online presence supporting mobile and social commerce trends catering to each market.
This localisation is the key to sustaining the business in the time of the COVID-19 crisis, and for speedier recovery and further long-term growth.
Access the Rapyd Asia Pacific 2020 eCommerce and Payment study here.
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Photo by Alejandro Escamilla on Unsplash
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