According to a new Timetric report, digital payments are gaining prominence in Singapore supported by the rising online and smartphone penetration, consumer preference for convenient payments and the presence of an increasing number of online retailers. With the introduction of payment methods such as PayDollar, Fastacash, PayPal, MOLPoints and MasterPass, the digital payments are expected to increase further and supplement the traditional cashless payments.

 

Singapore’s payment cards market is one of the most competitive and mature in Asia-Pacific, with credit and debit card penetration rates of 1.7 and 2.0 respectively per inhabitant in 2014. In terms of transaction value and volume, Singapore’s payment cards accounted for 0.6% and 1% shares respectively in the Asia-Pacific region in 2014.

 

“Singapore’s payments cards market changed rapidly with the center of innovation shifting from products towards channels and services. Although banks continue to develop new products, this tends to be little more than fine-tuning and modification of existing products,” says Timetric’s Analyst, Kartik Challa.

 

Consequently, a shift towards digital payments has attracted new operators to enter into the market by introducing alternative payment methods such as PayDollar and Fastacash in order to capture a larger share of the Singapore’s payments market.

 

“Consumers are increasingly inclined to use faster and more secure payment options, resulting in mobile operators, traditional and online retailers, and other service providers introducing efficient digital payment instruments,”Challa comments.

 

“These instruments are not only supplementing traditional cashless payments, but also changing the way consumers and merchants transact. The introduction of MasterPass digital payment platform by MasterCard in June 2014 is expected to further shift consumer focus on digital payments," Challa comments.

 

In October 2014, Visa announced the establishment of a technology hub in Singapore, with the aim of driving innovation in mobile and digital payments. “Such initiatives by Visa and MasterCard are expected to help card participants capitalise on the country’s growing e-commerce market, and serve the rising consumer preference for digital payments,” Challa adds.