SINGAPORE - For e-wallet user Nisim Shushan, having to maintain various local bank accounts around the world for his expenses is tedious and expensive, but he has no choice due to caps imposed on e-wallets here.
The British-Israeli expatriate, who is managing director and consultant at drilling engineering consultancy Enrgeo, makes cross-currency payments for various financial commitments on a regular basis. He has local bank accounts in Israel, Germany, Britain and Singapore, but would much rather use his multi-currency account with British-based digital payments company Wise for everything.
“Every one of those (bank) accounts costs me money and I would love to consolidate them,” said the 41-year-old, who has been studying for his PhD in mechanical engineering in Singapore since 2019. “But the (current) limits make it difficult to transfer big sums of money into my Wise account. I don’t feel like I’m actually in control of my account.”
He, along with other e-wallet users The Straits Times spoke to, was happy to hear about an October proposal by the Monetary Authority of Singapore (MAS) to raise the daily stock cap from $5,000 to $20,000, and the annual flow cap from $30,000 to $100,000.
The stock cap refers to how much money a user can have in his e-wallet at the end of the day, while the flow cap refers to how much a user can spend in a year using his e-wallet. Funds transferred from e-wallets to one’s own bank accounts, whether local or overseas, do not count towards the flow cap.
MAS concluded its public consultation on its proposal in late November.
In response to queries from ST, an MAS spokesman said the central bank is reviewing the feedback to see if there is a need to revise its existing stock cap and flow cap restrictions.
The spokesman added that the responses will be published soon and that any relevant amendments to its regulations will be made in due course.
E-wallet providers in Singapore, including HLF FastPay by Hong Leong Finance and Revolut, welcomed the proposed higher limits as the current caps cause much frustration for their users.
Ms Caecilia Chu, co-founder and chief executive of YouTrip, shared that some of the multi-currency mobile wallet’s users had already been asking for the flow cap to be increased to pay for things such as family trips, accommodation and education expenses. There were instances when users were unable to use their e-wallets to purchase flight tickets or make hotel bookings due to the cap.
A Grab spokesman shared that many users have come close to breaching its e-wallet’s annual spending limit, and that it expects this pool of users to grow.
According to Mr Surendra Chaplot, Wise’s global head of product – cards, who also oversees the Wise Business and Wise Platform services, the average tuition fee for an international undergraduate student studying in Australia is more than $30,000 per year and can go as high as $110,000 in Britain for a medical degree. This is well beyond its wallet’s limits.
He said: “This narrows their options to traditional banks and providers, which are often more expensive... More broadly, this also curtails competition as banks and non-banks are unable to compete on an equal footing, impacting innovation in the payment space.”
Ms Marjorie Ng, who is taking a break from work and has been based in Perth since September 2021, had been using her Revolut e-wallet for all her expenses until she exceeded the $30,000 annual flow cap within nine months. The 29-year-old found it “extremely limiting... and had to turn to Wise to convert Singapore dollars to Australia dollars” for her daily expenses.
The existing limits prevent some customers from taking advantage of other services that come with all-in-one e-wallets, such as Singtel Dash, which includes investments and insurance services in addition to payment services.
Mr Gilbert Chuah, Singtel’s head of financial and lifestyle services, said that with an increased limit, “users can enjoy seamless e-wallet usage on Dash without having to switch to alternative payment platforms or cash payment for different services”.
Others said they use e-wallets more for day-to-day transactions such as private-hire car rides or meals, and are not necessarily restricted by the existing caps as they do not make big-ticket purchases with their e-wallets.
But that may soon change. According to Statista, the number of mobile wallet users in Singapore is estimated to hit 5.8 million in 2025, up from 1.8 million in 2020.
The higher limits may not be of immediate use to many right now, but will be in the future, said Ms Visa Kannan, a partner at corporate venture capital firm Saison Capital.
She said: “As digital adoption increases and as we spend more online and digitally... we will start seeing more everyday use cases using e-wallets. This revision of limits is to capture the momentum.”