As China leads the way into becoming the world’s
first cashless economy and other countries try to catch up, Taiwan is lagging
behind. According to the study, ‘Payments
Landscape In Taiwan: Opportunities And Risks To 2022’, Taiwan’s e-commerce market is one of the
fastest growing in Southeast Asia and is driven by the rise in internet and
smartphone penetration. Behind the growth of e-commerce payments are the
multiple payment methods provided by e-commerce websites including payment
cards, direct debits, cash or card on delivery, bank transfer and digital and
mobile wallets. Despite this, for an average person living in the country paper
money and plastic bank cards are still an indispensable part of daily routine.
Cash continues to be the preferred mode of consumer
payment accounting for nearly four-fifth of the overall payment transaction
volume in 2016. It has been observed that consumers in Taiwan have a strong
inclination towards cash for day-to-day transactions despite the gradual rise
in electronic payments. Currently, in Taiwan only a proportion of the
population slightly greater than one-tenth has noticeably begun using mobile
payments, significantly lagging behind its Asian peers. A recent research
report showed that mainland China is leading in mobile payment adoption
accounting for three-fifth of the worldwide user base in 2018.
India has seen a three-fourth increase in the number
of users in the past two years and has become the world’s fastest growing
mobile payment market. Taiwan’s slow adoption is a bitsurprising considering
the fact that its economy took off decades earlier than mainland China and
other South East Asian countries. On top of this, Taiwan’s smartphone
penetration is one of the highest in the world and is expected to reach more
than nine-tenth of the population shortly. Further, studies show that the
country is not lacking any resource in order to adopt digital payments. Apart
from these observations, the data also shows that nearlyfour-fifth of the
population has access to mobile internet.
Debit cards remain the preferred payment cards among
Taiwanese consumers evident by the findings from 2016 which revealed that debit
card penetration in Taiwan was the highest compared to other regional
countries.
Taiwan was followed by Japan, South Korea, New Zealand, Singapore,
Australia and Hong Kong. As debit cards are offered as complimentary products
with current accounts, the large banked population in Taiwan has led to the
high debit card penetration. Although small, the credit cards market recently
registered the highest growth in terms of both transaction volume and values.
This growth can be attributed to the steady rise in the middle class and young
working population. It was also supported by a rise in consumer awareness of
the benefits of credit cards such as deferred payments, in paying installments
and cash back. Taiwanese consumers are increasingly using credit cards for
recurring payments such as utility fees, school tuition, insurance premiums and
taxes.
The general public is however, knowledgeable and keen
to try out the new payment methods. According to research, more than
three-fifth consumers in Taiwan are aware of NFC (near-field communication)
which is the underlying technology behind many popular mobile payment services
including Apple Pay and Samsung Pay. The public is being supported by the
government as the government of Taiwan has been promoting electronic payments
through initiatives such as the Act Governing Electronic Payments Institutions,
the launch of the Digital Banking 3.0 Plan to enable credit card payments for
government agency fees and taxes along with the establishment of a fintech
office and dedicated fund.
Taiwan has a long way to go to be recognized as a hub
for digital payments. The country currently has heavy reliance on paper money
however, the extensive use of plastic bank cards especially debit cards helps
to promote digital payments. Government efforts coupled with the public’s
expanding knowledge base are believed to soon transform Taiwan’s payment
sector.
For more information on
the research report, refer to below link:-
Related
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Contact Us:
Ken Research
Ankur Gupta, Head Marketing & Communications
Sales@kenresearch.com
+91-9015378249
Ken Research
Ankur Gupta, Head Marketing & Communications
Sales@kenresearch.com
+91-9015378249
