Cash still king in Singapore, due to privacy concerns
Privacy concerns are one of the main reasons Singaporeans don't do digital payments.
For local merchants, keeping up with digital payment trends is a challenge.
These were some key concerns raised by 500 Singaporean consumers and 200 merchants surveyed by online payment platform PayPal.
The findings of the study of 4,000 consumers across seven Asia Pacific (Apac) markets including China, India and Thailand were released yesterday.
More than half of local consumers surveyed said privacy was a concern, the highest in the Apac region, with China at 48 per cent, Hong Kong at 45 per cent, and an Apac average of 25 per cent.
Concerns with privacy include worries that financial information, like credit card details, may be shared with merchants during a purchase.
For merchants, lack of familiarity is a problem, with two-thirds thinking it is more difficult to follow new payment methods, compared with 57 per cent of the 1,400 merchants surveyed in Apac.
Cashless payments have been in the spotlight recently - Prime Minister Lee Hsien Loong noted in his National Day Rally that it is an area that Singapore is lagging behind in its Smart Nation vision.
According to the study, cash is still king here. An overwhelming majority - 90 per cent - preferred cash as their primary mode of payment, compared with 88 per cent in Apac.
Cash is the most common payment mode - 43 per cent surveyed said they used cash most often.
Although nearly everyone surveyed owned a smartphone, only 3 per cent used mobile wallets such as PayPal; and only 2 per cent used contactless payments via smartphones as their most common mode of payment.
PayPal said yesterday: "Singapore is one of the most digitally literate countries globally, but the current usage of digital payments is only scratching the surface of what it could be."