A theme which is currently prevalent across most of the world, but more so in Singapore, is that of digitisation and how to create a more accessible and efficient environment for all users.
In Singapore, most public services can be easily accessed from the confines of one's home, with the country having moved almost entirely to Web-based digitised forms. Information is readily available on the websites of government departments, doing away with the need for office visits. In terms of governance, Singapore is certainly among the world's leaders in digitisation.
However, in the sphere of domestic payments and day-to-day living, we have still not been able to completely eliminate the need for carrying cash. Although the need for cash is minimal, it is not zero. While I have managed to live without cash for several weeks, it has limited the choice of services available to me.
We are required to carry numerous pieces of plastic to perform our daily chores. I carry at least 10 different cards in my wallet, including my national registration identity card (NRIC), credit/debit cards, driving licence and several loyalty cards for merchant establishments that I frequent. There are another five to 10 cards lying at home which I carry for a specific purpose, such as the occasional visit to the cinema or episodic shopping at places like Ikea and other large department stores.
In addition to these are another 20-odd cards which are lying at home and need to be carried while travelling abroad, in the nature of a priority pass (for access to airport lounges) and loyalty programme memberships of various airlines and hotels, including at Changi.
I am certain that I am not alone in my card-carrying ways, however burdensome. While it is fair for somebody to question the sense in holding more than one credit card, as a matter of practice, many of us do.
As I struggle with this problem, I set my thoughts on what Singapore as a country needs to do to increase digitisation.
The list below is neither exhaustive nor in any order of priority.
1. ALL TAXIS SHOULD ACCEPT NON-CASH MODES OF PAYMENT
In my experience, taxis are a major reason why there is a need to carry cash in Singapore. Many taxis prominently display a "cash only" sign on their windows. I have found that some drivers of cabs equipped to accept electronic payments vigorously discourage the use of cards under various pretexts. What's more, many of those who accept cards do not accept payments via digital wallets.
The first step to address this problem would be for the taxi drivers to be educated and equipped for accepting digital payments. For those who continue to be non-compliant, the licence fee should be significantly enhanced. This will probably eliminate the most significant need for cash.
As a key component of public transport, taxis should be in a position to accept any mode of payment the customer wishes to pay with, including digital wallets, and this service should be made available without incurring substantial additional costs either to them or to the customer.
2. EXTRA CHARGE FOR USING CREDIT CARDS/NETS/EZ-LINK IN TAXIS SHOULD BE ELIMINATED
The extra charge of 30 cents for payment via Nets/ez-link may seem small in the larger scheme of things, but it is an irritant and a distraction in the spread of digitisation on the island. Not only does it add a significant percentage of the base fare (for short distances) to the cost, but the optics of such a levy also militates against the credo of digitisation.
As for credit cards, where they do accept them, taxis typically charge a 10 per cent fee, said to be for defraying administrative costs. That is clearly a disincentive to go cashless.
One also wonders why if most merchants and service providers in Singapore, including Uber and Grab, readily accept credit cards, licensed taxi providers cannot or do not.
3. IMPROVE THE NETS (NETWORK FOR ELECTRONIC TRANSFERS) PLATFORM
The Nets platform is one of two means (the other being ez-link) which enable payments across the widest variety of merchants and services.
Nets operates Singapore's national debit scheme enabling customers of six banks, namely DBS/POSB, HSBC, Maybank, OCBC Bank, Standard Chartered Bank and United Overseas Bank, to make payments using their ATM cards or mobile devices. But there are some banks which, for various reasons including cost, choose not to be on this platform. This curbs Nets' ability to function fully as a national debit platform.
There are many merchants which do not accept credit cards but do accept Nets. If one is a customer of a bank outside this network, then one has no option but to transact in cash. Apart from finding ways to get more banks on board, all those already in the scheme should provide a digitised version of the Nets debit card, allowing all Singaporeans possessing a smartphone to do away with their Nets card. Currently, only DBS offers such a facility.
Nets now also runs PayNow, the peer-to-peer instant funds transfer service wherein one can transfer funds from one's bank account to another's by using just the NRIC and/or mobile number. Once PayNow gains wider adoption, the need for plastic in any case should drop substantially. Undertaking significant efforts to create user acceptance for PayNow can make it the primary funds transfer mechanism without any intermediate layer.
4. ALL PLATFORMS SHOULD OFFER A QR CODE-BASED TRANSACTIONAL CAPABILITY (OR SOMETHING SIMILAR)
Currently, many features can be offered only if the smartphone device is NFC (Near Field Communication)-enabled. Since not all smartphones possess such a feature, many applications cannot be used.
For those which do not, a QR code-based capability should be an integral part of the offering so that digitisation can be achieved across various types of devices. A good example is Starbucks or Golden Village cinemas, which offer access via QR code.
5. DIGITISATION OF LOYALTY CARDS
Most major merchants, including FairPrice and Ikea, now run loyalty programmes for which they distribute plastic membership cards. While several enterprises (like Starbucks) have digitised the plastic cards, many have not done so. It is time surely for all to do so, so that customers are not deprived of their loyalty privileges if they happen not to carry the plastic version with them.
6. DROP NFC CARD CHARGE
Many people who have an NFC-enabled phone are unable to use their phone if the SIM card is not NFC-enabled.
This came as news to me when I bought a new phone and ran into the problem. Upon checking with the telco, I was told that I had to pay an additional sum of over $37 for an NFC-enabled SIM card. If we are serious about pushing the digital drive, this extra fee should be done away with or at least reduced to a smaller sum.
Furthermore, despite having the new NFC-enabled SIM card, to my utter disappointment, I discovered that I still could not use my phone on the MRT and buses because the ez-link NFC does not support the phone model (Oneplus 5T) that I had purchased.
7. NRIC SHOULD BE DIGITISED
If the identity card can be digitised and made available for display on smartphones, it would be a game changer as an educational effort towards digitisation.
Digitisation does not imply that the plastic version does not get issued. It is understood that the digital ID may not be suitable for some people and for them the default form of identification would be the physical card. But for the vast majority of people, it would mean one fewer card to carry around.
8. ALL-PURPOSE POS DEVICES
Point-of-Sale (POS) machines are those devices which enable card-carrying customers to make payments. Many of these machines are still activated only for card swipes and cannot take payments from other options like digital wallets.
There is a strong case to be made for the use of more omni-format machines to make payments easier, both for the customer and the merchant.
To reiterate, the list of suggestions is certainly not exhaustive and there are bound to be many more ways that will help spur the digital push in Singapore. To be sure, there will be reasons given for difficulties in making the switch.
But if we are serious about being a Smart Nation, then the above is a good list to start with.
•The writer, a former head of foreign exchange and interest rate products for the wealth management business at Standard Chartered Bank, is now an adviser on business and strategy and writes and speaks on the future of financial services and fintech.
