Singapore

Insight

Singapore’s citizens are highly reliant on debit, credit and charge cards, with an average of 4.5 cards per adult. This can often be a barrier to IP adoption, as there’s little motivation to change — but Singaporeans seem open to adopting new technology and changing payment behaviors.

Case in point, mobile wallet usage has grown significantly in recent years, more than quadrupling in the period from 2014 to 2019. This, combined with IP integration in mobile wallets as of 2017, means Singapore experienced rapid IP growth in the period from 2017 to 2020.

In the coming years, it’s likely IP will continue its upward growth trajectory. It is expected to cannibalize paper-based payments, supplanting cash and checks as the go-to payment for those typical use cases. And with both consumers and corporates benefitting from access to so many different initiation and authorization methods, IP is not only readily available but also extremely convenient.

ACI’s take

Singapore has already seen impressive IP growth, but there are certainly factors which might drive this further. Historically, a lack of central bank mandate has kept PayNow membership to a limited group, and this understandably has impact on volumes. Lack of mandate can also lead to inconsistency in availability of services across the banks and financial institutions, which inhibits the development of a rich ecosystem of fintechs and integrated services, so this needs to be addressed.

As we’ve seen elsewhere in the world, involvement in a pan-regional scheme may also play an important role. Singapore’s involvement in a cross-border payments initiative with ASEAN IP schemes will drive IP growth through adoption of different payment types, particularly in the corporate sector. Singaporean institutions should seek inspiration from their Nordic counterparts, to understand how cross-border initiatives can drive commerce and reduce overhead within the banks.