Emerging technology services are often seen as an indicator of national progress, but Singapore, with internet penetration of up to 100% and smart machine penetration of 98%, has not made as much progress as expected in digital payments, with local consumers and businesses still heavily reliant on cash for transactions.
Despite being internationally known as a global fintech hub, Singapore’s cashless development process appears to be starting to lag behind the rest of southeast Asia, according to a recent Visa report.
According to the data, only 68% of Singaporeans can live without cash in one day, compared with 76% in Indonesia and 69% in the Philippines.
Similarly, only 42％ of Singaporeans were able to live without cash for three days, according to the survey, with similar results seen in other parts of south-east Asia.
This means that while Singapore’s cashless availability is high and the cashless use methods that Singaporeans are exposed to are also very rich. But there are still plenty of people who think cash is essential and that it is not feasible to remain cashless for a long time.
According to a previous Paypal report, up to 88% of Singaporeans use cash as one of their payment methods. Cash was the most common payment method among Singaporeans at 43%, followed by credit CARDS.
Singaporeans are still highly dependent on cash, but their awareness of electronic payment technology is not low, and their awareness of various technologies is higher than the Asian average:
For example, non-contact card payment recognition rate is 62%, much higher than the Asian average of 23%. Contactless mobile payments were also 50 per cent higher than the Asian average of 49 per cent. Awareness of e-wallets was 38%, higher than the Asian average of 23%. Recognition of mobile phone built-in App payment was 29%, higher than the Asian average of 14%, while recognition of digital currency was 9%, lower than the Asian average of 11%.
The high cash Use index in Singapore is mainly due to the diversity but low compatibility of its electronic payment systems, which require consumers to use a variety of cards or devices, as well as the need for businesses to set up multiple machines to cope with consumers ‘ diverse payment methods.
At the same time, consumers’ ingrained cash habits are also to blame.
The move comes after a VISA report found that only 50 per cent of Singaporeans knew about QR codes for mobile payments. While Singaporeans are more receptive to card payments, they cannot deny that the cost of card terminals is suppressed.
The ubiquitous e-wallet may not be able to stop Singaporeans from making large payments with CARDS, but it could allow small merchants to make cashless payments.