Singapore – In 2023, Asia-Pacific recorded the highest payment transaction value, amounting to a total of US$29,063b, accounting for 52% of the global total. This is according to the latest report by market research firm Euromonitor International.
Data from the report found that the convenience of digital wallets continues to drive up adoption in the region, especially in countries such as Thailand, Indonesia, China, and India.
In particular, nearly 70% of consumers in China use WeChat Pay daily, while over half of Indian consumers use PhonePe every day. Indonesia, on the other hand, has experienced the fastest-growing mode of personal payment transactions, with a CAGR of 67% from 2018 to 2023.
This growth is driven by the widespread use of smartphones, the increasing adoption of digital wallets, mobile banking,and the Quick Response Code Indonesia Standard (QRIS), which was developed for cashless payments.
Developed markets like Singapore and Hong Kong also saw significant growth in mobile proximity payments, with a CAGR of 31% and 19%, respectively, from 2018 to 2023.
Meanwhile, when it comes to ease, speed, and security of card payments, the report also noted that debit cards remain the most popular transaction type for personal card payments in China. This encompasses their popularity, boosted by a state-backed inclusive finance programme to encourage bank account openings in rural areas.
Furthermore, the transition to the Unified Payments Interface has attracted local consumers to faster, more convenient, and more secure transactions compared to wallets. This results in cash transactions continuing to lose their share.
Following the growth in UPIs, credit cards are also projected to surpass debit cards in terms of transaction value by 2028, even as debit cards remain dominant in terms of cards in circulation. Credit cards are further expected to outperform debit cards in terms of transaction value by 2028, driven by the strong growth in Unified Payments Interfaces (UPIs).
For instance, in Japan and South Korea, paper transactions have sharply decreased due to the widespread adoption of electronic and card payments.
Japan experienced negative growth in the same period, marking the second-highest decline in retail value after China. South Korea, on the contrary, saw the largest percentage decline in paper transactions, dropping by 39% from 2018 to 2023, while mobile proximity payments grew by 29%.
David Zhang, insights manager for payments and lending at Euromonitor International, commented on the report, stating, “In Asia Pacific, embedded finance partnerships between incumbent financial organisations and FinTechs have accelerated the development of digital IDs and remote verifications.”
“Additionally, advanced credit decisioning and governments’ initiatives, including payment standardisation (fast payment and QR) and subsidies, have paved the way for greater financial inclusion, payment diversification, and cashless payment growth,” he further explained.
