Cashless, seamless, effortless: More choosing easier, smarter ways to pay

If you’re choosing e-payment options, you are among the majority of consumers in the Asia-Pacific region. Is cash no longer king? What’s behind the shift?

The introduction of Giro in 1984 was the Government’s first foray into e-payments. Since then, initiatives such as the EZ-Link card, PayNow and the Singapore Quick Response Code (above) have been rolled out to promote cashless payments. PHOTO: ST FILE

For Mr Nur Azhari, less is more when it comes to paying for stuff with e-payment solutions. His key reasons: Less hassle, more rewards, online convenience.

Online purchases make up about 70 per cent of his monthly expenses. With e-payments, he can skip long queues and shop safely - especially amid the heightened alert phase when people have been encouraged to stay home.

"Online shopping works better for me as I do not have to go through the hassle of going to a physical outlet to pick out and buy stuff," says the 29-year-old training consultant.

Mr Azhari, who is single, prefers e-payment solutions over credit cards. He uses GrabPay for ease of use, transparent fees and rewards points. Between shopping, booking Grab rides and ordering food deliveries, Mr Azhari uses Grab's e-payment solution at least five times a week.

Creative manager Bryan Tjoa also finds e-payment solutions useful for their convenience and rewards. "When I leave home, I no longer have to worry about having my wallet with me," says the 28-year-old.

Mr Tjoa uses e-payment solutions to pay for his daily essentials and food purchases. An added incentive for going cashless is the 10 per cent cash rebate he enjoys at Food Republic, which he visits regularly.

Ms Maureen Wong, 35, who frequently uses an app to pay for her food and drinks at her neighbourhood coffee shop finds the payment mode convenient for both stallholders and herself.

"I can pay the exact amount and the stallholder can focus on food preparation," says the leasing manager.

These users' preference for e-payment solutions reflects a global trend towards digital wallets becoming the payment method of choice, accelerated by the Covid-19 pandemic.

Digital wallet payments accounted for 44.5 per cent of e-commerce transactions last year, according to the 2021 Global Payments Reports by payment processing company Worldpay. That's up 6.5 per cent from the previous year.

The report ranked digital wallets as the most popular payment method in the Asia-Pacific region last year, accounting for over 60 per cent of e-commerce transactions, with credit cards in second place at just over 19 per cent.

Mr Azhari, for one, likes that the GrabPay card - a prepaid card - allows him to use his GrabPay wallet with a wide range of merchants that accept Mastercard payments.

"I get to earn points, while still retaining the same usability and features as any other debit or credit cards with almost all online merchants."

GrabPay's inclusion in the Singapore Quick Response Code (SGQR), the world's first unified payment QR code launched by the Monetary Authority of Singapore (MAS) in 2018, has further simplified its payment process by enabling customers to scan a single QR code to pay for goods and services from different merchants.

Other e-payment solutions like Nets, DBS PayLah!, Singtel Dash and AliPay are also compatible with the QR code. Over 200,000 SGQR labels are available at merchants islandwide as of February.

Says Mr Azhari: "I would prefer to go cashless whenever possible. Using GrabPay is very useful as it means I can carry less cash around and pay digitally.

"I think this is a very important point for users like myself who value convenience and would prefer to have a payment system or app to consolidate all our payments and expenses, where possible."

Cashless leads the way

The pivot towards e-payments was cited by MAS board member and health minister Ong Ye Kung. In February, he commented that the Covid-19 pandemic and rise of e-commerce had accelerated online payment adoption among Singaporeans.

For example, Mr Ong cites that of the 4.9 million registrations for PayNow, a secure funds transfer service launched by MAS in 2017, 1.6 million were made in the last year.

Mr Ong said that the volume of PayNow transactions also doubled from a year ago to $5 billion in December, with growth expected to continue on the back of GrabPay, Liquid Pay and Singtel Dash rolling out PayNow services.

Today's consumers can choose from a wide variety of e-wallet solutions offered by both financial and non-financial institutions.

In February, the Association of Banks in Singapore announced that Grab would be one of the first non-bank financial institutions to offer PayNow. PHOTO: GRAB

But GrabPay has consistently taken the top spot as the most popular e-wallet in Singapore, according to a study by meta-search website iPrice Group and mobile data and analytics platform App Annie Intelligence.

Between 2017 to 2019, GrabPay had the highest number of active users, followed by DBS PayLah!, FavePay, EZ-Link, AliPay and Singtel Dash.

GrabPay was first launched in 2016 as an e-wallet that can be topped up or linked to a credit or debit card.

It has since been expanded to support bank transfers via PayNow, and a physical GrabPay Mastercard that allows users to make purchases from non-partner merchants online and offline.

In December last year, Grab launched PayLater - a "buy now, pay later" service that allows consumers to pay for purchases in the next month, or over four monthly instalments with zero interest.

A key feature of GrabPay is GrabRewards - a loyalty programme that provides up to six points for every dollar spent on GrabPay, and four additional points per dollar for purchases in certain categories with the GrabPay card as part of a new points accelerator programme.

These points can be used to offset Grab rides, GrabFood orders or future purchases made with GrabPay at e-commerce merchants and physical retail outlets.

GrabPay can also be used to track finances. And instead of credit statements, GrabPay provides instant details of purchases such as the time of purchase, retailer's name and number of GrabRewards points earned within the app.

"As each transaction has a receipt or invoice, I can simply refer to my recent purchase history to see what and how much I spend on any product or service," says Mr Azhari.

"This helps me to manage my own finances within a single app."

Path to payment security

Even as a plethora of cashless payment options offer consumers ease and speed at their fingertips, some people still worry about the security of digital payments.

Many of the elderly here, for instance, have fears of fraud when using e-payments. To safeguard Singaporeans against such risks, the Government has stepped in with measures to help people make the digital leap with greater peace of mind.

Early last year, the Payment Services Act was introduced to regulate e-payment services while encouraging fintech innovation and growth. Under these regulations, e-wallet providers such as GrabPay have to adhere to balance and transaction limits set by the MAS.

For example, e-wallet providers cannot hold more than $5,000 in a user's e-wallet at any given time. Single, monthly and annual transaction limits are also regulated.

In a 2019 parliamentary speech, Mr Ong said that these caps help to protect customers by limiting potential losses from their e-money account. They also keep safeguarding measures for e-wallets simple and low-cost compared to the deposit insurance that banks have to undertake, he added.

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