Digital payment trends are said to be picking up in Singapore with Gen Z leading shift, according to a report. Currently, two-thirds (68%) of Singapore’s Generation Z “prefer to pay with PayNow and close to 3 out of 10 use GrabPay (29%).
New research by global small business platform Xero claims “that Singapore’s younger generations of consumers are leading the shift to digital payments while more than half of small businesses in the country do not currently provide cash payment options.”
Launched recently, Xero’s new report ‘I want to pay that way’, delved “into changing payment habits among consumers and how small businesses are adapting.”
The survey findings reveal a growing trend “towards digital payments in Singapore, driven by strong government support and initiatives aimed at building a digitally connected society.”
Currently, over three-quarters “of Singapore consumers (76%) use credit or debit cards for payments.”
More than half of the population “utilizes funds transfer service PayNow (55%) or bank transfers (55%).”
About a fifth are also “using e-wallet service GrabPay (22%) and buy now, pay later platforms (21%). Reflecting changing perspectives, the research showed that 30% of Singapore consumers only carry their mobile phones to pay when shopping, notably higher than the global average of 21%.”
Younger generations are leading the way, “quickly embracing new digital payment methods. PayNow is the preferred digital payment method for 68% of Gen Z consumers in Singapore , with about a third (29%) also using GrabPay.”
Koren Wines, Managing Director, Asia, Xero said “Singapore is at the forefront of building a robust digital payment landscape.”
The findings also highlight that failing to “meet consumer payment preferences can directly impact customer retention and revenue.”
Approximately 18% of Singapore consumers “indicated they would visit another business that accepts more payment options if a business didn’t offer at least one of their preferred payment methods.”
Despite trends indicating a shift towards a cashless society, physical currency “remains a preferred payment method for a significant portion of Singapore’s population.”
Nearly eight in ten (79%) Singapore consumers “use it for transactions, highlighting its prevalence in everyday life.”
However, half (51%) of local small businesses “no longer offer it as a payment option, making small businesses in Singapore the least likely among the countries surveyed to accept cash payments, despite having the highest proportion of consumers who opt for this traditional method.”
Nearly nine in ten (87%) small businesses in Singapore “say they have benefited from adopting new payment methods in the last 6 to 12 months, with key reported advantages including reduced time to be paid (43%), retaining more business (42%), and increased sales (41%).”
Many small businesses in Singapore “are optimistic about future or emerging payment methods.”
These include biometric authentication methods “such as fingerprints or facial scanning (36%), bartering marketplaces/apps (33%) and augmented reality (33%).”
About a third (31%) have expressed excitement “about implantable payment chips, a much higher figure than small businesses in countries like Australia (7%) and New Zealand (9%) included in the research.”
As a commitment to delivering on its business strategy, Xero is “building payment solutions to make it easier for small businesses to make and collect payments more seamlessly while helping them to maintain a healthy cash flow.”
