Payment trends in Asia

Payment trends in Asia

[quote]Christophe Bourbier, Chairman of Limonetik[/quote] 

According to a study published in 2012 by Worldpay about methods of payment used in different areas of the world, it is the credit card, accounting for 37% of payments, which is the most popular means of payment in Asia/Pacific. Other notable players include the ewallet (23% of payments), the bank transfer (14%) and payments by cash (11%). Let’s have a closer look at the different countries within Asia.

A closer look reveals that the situation is far from homogeneous. Whilst some Asian countries continue to favour the credit card, others show a huge increase in mobile payments.

In India, for example, cash and rechargeable cards (37,3%) are the preferred methods of payment. Mobile payments account for 4% of all transactions, whilst eWallets are still in their infancy (1,5%). As for Bangladeshis, they mainly pay by card (56%), although offline methods are still significant (offline bank transfers and cash accounting for 15% and 23% respectively). Ewallets and mobile payments currently make up only 0.2% of all transactions. In other Asian countries, mobile payments are much more popular.

The mobile payment boom

Whilst mobile payments are still very much in their beginnings in western countries, in Asia and Africa millions of people already transfer money or pay bills, simply by sending a text message from their mobile phone. The mobile payment also plays its part as an economic development tool in these areas of the world. Its success may be attributed to the number of mobile phones in circulation, which is higher than the number of bank accounts.

In Indonesia, the mobile phone penetration rate is 106% (more than one phone per habitant), whilst only 20% of people have a bank account. In Japan, around 59.5% of transactions are performed by credit card. Otherwise, nearly 17% of payments for goods are effected at a Konbini (a convenience store) whilst cash on delivery makes up 12.7% of payments. Mobile and eWallet payments account for a relatively low proportion of transactions, 0.3% and 6.6% respectively. In South Korea, credit card payments, where security is strictly regulated, are the most common in E-Commerce. Following card payments (in a distant second) are online transfers.

Mobile payments are booming in China. The latest projections from research firm Analysys International indicate that 13,920 billion CNY (around 2,000 billion USD) worth of Internet transactions will be made in 2015. There will be 1,378 billion accounts registered for online payment, whilst mobile payments will total 712,3 billion CNY (around 100 billion USD). The numbers are mind-boggling.