The growth of real-time payments have accelerated and are now as popular as cash as a payment method for consumers in Southeast Asia, according to new research from ACI Worldwide and YouGov.
The research revealed that three out of five consumers (61%) in Indonesia, Malaysia, Thailand and Singapore would rather utilise real-time payments as a favored way to pay in 2021, level with cash (61%) and higher than other payment categories.
It’s a trend that comes off the back of the pandemic, which dramatically shifted consumer habits and the way they interacted with money and transactions.
Due to rapid technological change, consumers now expect mobile-first and real-time experiences — however, payments have often lagged. The development of real-time payment systems enables consumers, merchants and financial institutions to pay friends and customers, settle bills, and transfer money instantaneously.
Leslie Choo, Managing Director – Asia, ACI Worldwide, commented on the data: “This fundamental shift in consumer demand and payment expectations sets forth a challenge for Southeast Asia’s banks, financial institutions and merchants.
“These organisations can ill-afford to put their modernisation projects on hold, despite the challenges caused by COVID-19. On the contrary, they can drive growth by joining the region’s emerging real-time payments ecosystem, which will improve their ability to innovate and transform while reducing the cost of infrastructure and operations.”
The ACI Worldwide and YouGov study also reveals how consumers across Southeast Asia expect the benefits of using real-time payments in their domestic markets to extend across borders once they begin to travel internationally again, as well as when they shop cross-border.
For future international travel, consumers have elevated expectations for the transparency, safety and convenience of their payments when compared to their travel experiences pre-COVID-19:
More than half (54%) of consumers in Southeast Asia who have travelled internationally in the past expect their usage of real-time payments to increase when they next travel, whilst 70 percent say the ability to use their preferred payment methods while travelling will be more important now. As a result, a quarter (26%) expect their usage of traditional payment methods such as cash to reduce when they next travel.
Choo concluded: “A focus on payments modernisation is vital for financial institutions that want to ride the wave of the region’s biggest and most transformative payments trend — the emergence of a cross-border, real-time payments ecosystem. Unencumbered by legacy payment systems that can impede innovation in mature markets, countries in Southeast Asia can leverage robust domestic central payment infrastructures as the foundations for cross-border real-time payments, which will be a catalyst for growth and trade in the coming years.”