- QR code tops payment methods used by Singapore mobile payment users
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| Source: UnionPay/Nielsen infographic. Cash vs mobile payments. |
The study revealed that mobile payment respondents in Singapore used an average of 2.4 mobile payment platforms*** in the past three months.
Sentiments towards mobile payments were also generally positive, with two in three Singaporeans indicating that they are likely to recommend mobile payments to their social circle. Additionally, more than six in 10 (64%) said they would teach their friends, family and colleagues how to use mobile payments if they were resistant to adopting the new payment technology.
“The use of mobile payments is clearly on the rise among Singaporeans of all ages. With the government, financial institutions and payment networks making a concerted push to drive mobile payments, the efforts have significantly raised public awareness, and increased mobile payment adoption among consumers in Singapore.
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| Ling (left) presents results of the study while Kea (right) looks on. |
"With the multitude of mobile payment methods and platforms available, as well as a rapidly expanding network of merchants that accept mobile payments locally and overseas, we believe that mobile payment adoption will continue to grow and be even more deeply integrated into lives of Singaporeans in the near future,” said Vincent Ling, Deputy GM, UnionPay International South East Asia.
“Singapore is accelerating its journey towards a cashless society and mobile payments are becoming a pivotal part of our society in the future," said Garick Kea, Executive Director, Consumer Insights, Nielsen Singapore. "With 59% of respondents being favourable of Singapore becoming a cashless society, the study can be leveraged upon to take Singapore closer towards its Smart Nation goals."
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| Source: UnionPay and Nielsen infographic. Popularity of different mobile payment types in Singapore. |
When comparing the use of various payment modes, it came as no surprise as cash emerged as the top mode of payment for Singaporeans, with 94% having used cash in the past three months. This was followed by the credit card, with 71% having used this form of payment method in the past three months, while 62% had used a debit card for payment in the same period.
In terms of the payment method that is used most often in the past three months, the credit card topped the list with 35% of consumers using it most often, followed by cash (28%) and debit cards (18%).
The credit card was also the top digital payment method used by majority of Singaporeans. Close to nine in 10 (88%) of Baby Boomers, 86% of Generation X and 83% of Millennials had used credit cards for payment in the past three months. However, for the younger Singaporeans – Generation Z in particular - the debit card was the top digital payment method used with 83% having used this form of payment in the past three months.
Respondents had used an average of 2.4 mobile payment platforms or apps in the past three months, with 70% of mobile payment users having used a mobile payment platform with a mobile wallet, 65% having used a mobile payment platform with a connected bank account, and 30% having used a mobile payment platform directly linked to a credit or debit card.
The QR code is tops with 67% of Singaporeans having used it in the past three months. This was followed by P2P transfers with 65%, and contactless payments with 43% of Singaporeans having used it in the past three months.
When comparing the adoption of mobile payment methods across demographic groups, the QR code was the top mobile payment method used by the Baby Boomers and Generation X, while P2P transfers were the most adopted mobile payment method among the younger Generation Z and Millennials.
Despite the differing preferences for mobile payment methods, close to one in four (23%) Singaporeans said that they have used all three key modes of mobile payment in the past three months. However, each mobile payment method was characterised by the following usage traits:
Mobile QR code
Higher adoption rate (67%), used less frequently (averaging eight times per month)
Mobile P2P transfer
Higher adoption rate (65%), used less frequently (averaging six times per month)
Mobile contactless payments
Lower adoption rate (43%), used more frequently (averaging 10 times per month)
As for mobile payment users who have not tried QR codes for payments, the top barriers cited include:
Other payment methods are hassle-free (54%)
Payment method is not widely accepted (45%)
Unfamiliar with how to use it (36%)
“Among the various mobile payment methods, (the) QR code is the most commonly-adopted mobile payment method among Singaporeans in the past three months, ranking above mobile P2P transfer and even mobile contactless payments. With the increasing pervasiveness of QR code for payments across a variety of mobile payment platforms, along with its increased acceptance at merchants across the island, we believe that the adoption rate and frequency of usage for QR code will continue to rise.
"UnionPay, as a leader in enabling QR code for payments, has been working on expanding acceptance of UnionPay QR Code for payments across the globe. As of today, we have over 7.5 million merchants accepting UnionPay QR Code for payments worldwide, and this includes popular merchants such as Bath & Body Works, Itacho Sushi, Lady M, The Clifford Pier and Victoria’s Secret, as well as everyday merchants such as Buzz, Amoy Street Food Centre and Maxwell Food Centre in Singapore,” said Ling.
With mobile payments on the rise, the study found that consumers are generally positive about Singapore's goal of going cashless. In fact, three in five respondents said that they would like for Singapore to become a cashless society.
Despite the positive outlook towards going cashless, consumer confidence in living in a completely cashless society is lower. Only two in five Singaporeans said that they are confident in living in a completely cashless society, while among the older Baby Boomers, the confidence level drops to 31%.
Nonetheless, the majority of respondents still see value in driving mobile payment adoption within their respective social circles as the nation works towards greater inclusivity in the cashless drive. Two in three Singaporeans said that they are likely to recommend mobile payments to their family, friends and colleagues, while six in 10 (64%) would take the initiative to teach their family, friends and colleagues to use mobile payments if they were resistant to doing so.
Against this backdrop, the study also revealed the consumer sentiments towards the top drivers and barriers surrounding mobile payment adoption:
In terms of consumer sentiments towards Singapore becoming a cashless society in the near future, less than half (42%) said that they are confident that Singapore will become a cashless society in the near future. Additionally, respondents estimated that it would take Singapore around 12 years on average to go completely cashless.
Ling said that UnionPay is committed to its vision of a cashless society despite the predictions of consumers with innovative products and partnerships.
“The journey towards a cashless society is not going to happen overnight. As we continue to accelerate towards this vision, mobile payments will play an increasingly important role in replacing cash, especially for lower value purchases. Hence, it is important that our society collectively takes steps to help others adopt mobile payments, to foster a more inclusive Smart Nation.
"At UnionPay, we believe that our push to enable QR code for payments will also play an important role in enabling a more inclusive cashless society, as this form of payment allows consumers and merchants to adopt it easily without the need for costly devices or infrastructure. By using any smartphone with a camera, consumers and merchants will be able to use QR code for payments easily and securely, as part of our collective journey towards a cashless Singapore,” said Ling.
Ling added that the advantages between cashless and cash payments may not be obvious to an end user. "It's like moving from a feature to a smartphone," he explained. In the past typing text on the keypad of a feature phone would have taken a longer than the intelligent screen- and voice-based methods we can use today. There is an analogous opportunity cost with using cash - it has to be counted, the accounts have to be reconciled daily, and the owner has to spend time at the bank to deposit the money. All this time could have been used on something else. And while going cashless would require an investment, the time saved is worth it, he said.
Kea noted that going cashless has occurred successfully in other countries. "It is really a case of the education process," he said. "We can very clearly see that the consumers, the merchants, they haven't realised the opportunity cost that comes with (cash)."
He also observed that countries where there is less legacy infrastructure, such as widely-entrenched credit card use, have leapfrogged over those with more developed infrastructure into the cashless world. Other factors driving cashless payments, Ling added, would include less availability of cash, and the presence of counterfeit notes.
UnionPay International focuses on the international business of UnionPay, a global payment network that serves the world’s largest cardholder base. With over 7 billion UnionPay cards issued in 49 countries and regions, and over 51 million merchants and 2.6 million ATMs accepting the cards in 170 countries and regions, UnionPay is currently one of the fastest-growing payment networks in the world.
In Southeast Asia, UPI has enabled ATM, point of sale (POS) acceptance and card issuance across all 10 countries. In Singapore, UPI partners Bank of China (BOC), DBS Bank, Industrial and Commercial Bank of China (ICBC) and United Overseas Bank (UOB) to provide a wide array of payment products and services.
*Mobile payments are defined as payment transactions that are conducted using a mobile phone using banking instruments or stored value accounts (Gartner).
**The Future of Payments Study is an online survey conducted by UnionPay International and Nielsen in September 2018 with 400 mobile payment users in Singapore, aged between 18 to 65. The sample includes 100 respondents from Generation Z (aged 18 to 21), 100 Millennials (aged 22 to 37), 100 respondents from the Generation X (aged 38 to 50) and 100 Baby Boomers (aged 51 to 65), with an equal split among genders.
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