According to new research, by 2025, digital wallets will surpass credit cards as the most popular electronic payment method in Hong Kong, helping to speed up the city’s efforts to increase online sales.
Daniel So, Hong Kong merchant payments manager at Worldpay from FIS, said that owing to the Covid-19 epidemic, Hongkongers are turning to digital wallets. New York-listed FIS is a subsidiary of Worldpay.
A digital wallet is an online financial account that allows users to store money, pay bills, and monitor their spending via a smartphone app. The city’s government has designated four digital payment platforms as the primary options for the consumption voucher system: Alipay, WeChat Pay, Tap & Go, and Octopus.
The government of Hong Kong offered a subsidy for electronic payments in order to encourage people to use them.
According to Worldpay, Alipay, WeChat Pay, Tap & Go, and Octopus drew over 4.7 million new users and 96,000 new merchants in Hong Kong by the end of 2021.
The growing usage of digital wallets in Hong Kong promises well for the city’s e-commerce sector, which the FIS’ Global Payments Report predicted will rise 10% each year over a five-year period to $31.2 billion in 2025.
However, credit cards will continue to be the most common payment method at physical locations, accounting for more than 50% of transaction value in 2025, according to the study.
When the government starts giving out new digital coupons worth HK$10,000 (US$1,277) to 6.3 million eligible people in Hong Kong from next month, digital wallet adoption is expected to rise even more
Following China’s aggressive push for its digital yuan, formally known as the Digital Currency Electronic Payment, Hong Kong is considering the deployment of its own digital currency.
The Hong Kong Monetary Authority is exploring a digital currency (e-HKD) that will be used by the public to make money transfers.
Find the study used for this article here.