![]() ![]() To further encourage the use of credit cards, banks have stepped up with instalment plans, discounts, reward programmes, and cashback offers.Ĭredit cards continued to maintain their dominance right through Covid-19. Much of this growth is attributed to its solid and reliable payment infrastructure, leading to consumers preferring credit cards over other online payment methods. Hong Kong is a mature payment card market, recording a high card penetration rate of 3.4 cards per inhabitant. By the end of 2021, the total number of credit cards in circulation stood at over 19 million - this is a staggering figure when weighed against the city’s 7.6 million-strong population. China has also announced plans to expand its digital currency e-CNY nationwide and proposed the launch of a pilot scheme in Hong Kong.Ĭredit cards have consistently remained a top choice in Hong Kong’s payments landscape, with Statista noting that they accounted for 55% of all point of sale (POS) transactions in 2021. Recently, Chinese private banks Zhongguancun and NewUp completely terminated cash services, further propelling China towards being fully cashless. With the government leveraging various channels to encourage the use of digital payments in Hong Kong, it’s clear that cashless is the way forward.Ĭross-border transactions spur digital shiftĬlose economic and trade ties with the neighbouring China market are likely to hasten Hong Kong’s transition to digital payments. The e-voucher scheme is set to continue with the second phase in 2022, distributing HK$10,000 in e-vouchers to 6.6 million eligible Hong Kongers in two stages. ![]() From just the first phase of this e-voucher scheme alone, digital payment usage in Hong Kong soared, with at least 2.2 million new accounts created on Octopus, AlipayHK, WeChat Pay HK, and Tap&Go. With each of these platforms coming with its own separate perks, Hong Kongers were effectively encouraged to use digital payments. The first batch of HK$5,000 e-vouchers was funneled through four major digital payment operators: Octopus, AlipayHK, WeChat Pay HK, and Tap&Go. More recently, in 2021, the Hong Kong government rolled out a HK$36 billion e-voucher scheme to stimulate consumer spending during Covid-19. Before the FPS’ launch, bank transfers between different banks were time-consuming and expensive. This payment financial infrastructure enables 24/7 instant payments across all payment channels, including cards and digital payments. Later in 2018, the HKMA rolled out the Faster Payment System (FPS). This exercise began with the widespread distribution of POS terminals throughout Hong Kong between 20, which saw the total number growing by a CAGR of 4.1%. To steer Hong Kong beyond cash, the Hong Kong Monetary Authority (HKMA) has been proactive in encouraging the use of cashless payment methods. Local government initiatives to drive digital payments ![]() ![]() This practice is especially apparent during auspicious festivities like Lunar New Year, when Hong Kongers maintain the tradition of giving and receiving crisp, new notes in red packets. “The reason why people like cash here is that they simply like the tangible feel of money." The publication attributed Hong Kong’s love affair with cash to public distrust in smart payments on both the merchant and consumer fronts.Īccording to Philip Kam, General Manager at the Hong Kong Institute of Bankers, The Chartered Banker declared that cash is still king in Hong Kong. While Visa’s report on consumer payment attitudes recorded a net decrease of 37% for cash usage between 2019 to 2020, cash persisted as one of Hong Kong’s top payment choices during the pandemic, constituting 23% of all methods used by August 2020. In this article, we will examine Hong Kong’s most popular payment methods, summarised as follows: To stay competitive, financial institutions must quickly adapt to the fast-evolving payment needs of the local population. Consumer behaviour has altered entirely as a result. However, the Covid-19 pandemic and severe lockdown measures have drastically changed Hong Kong’s payments landscape. As recently as 2019, 88% of Hong Kong shoppers still used cash when they shopped offline. According to Unicard HK, Hong Kong consumers have considerable concerns over data privacy and security. According to The Asset, Hong Kong has one of the most advanced digital economies, ranking second to Singapore in Asia Pacific and third globally.ĭespite this, Hong Kongers are somewhat wary of digital payment solutions. Hong Kong is an increasingly digital-savvy society, with a mobile penetration rate of 320% in November 2021 and an internet penetration rate of 93% in January 2022. ![]()
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