- Almost three quarters (72%) of consumers in Thailand select real-time payment methods – such as PromptPay – as their preferred way to pay in 2021, higher than cash (63%) and digital wallets (49%).
- Four in ten (40%) consumers in Thailand have reduced their usage of traditional payment methods such as cash, credit cards and debit cards since the onset of COVID-19.
- Strong consumer demand for real-time payments demonstrates urgent need for payments modernisation across Southeast Asia and heralds the emergence of a regional cross-border, real-time payments ecosystem.
Real-time payments are now more popular than cash and mobile wallets as a payment method for consumers in Thailand, according to new research from ACI Worldwide (NASDAQ: ACIW) and YouGov. Almost three quarters (72%) of consumers in Thailand chose real-time payment methods – such as PromptPay – as a preferred way to pay in 2021, higher than other payment categories such as cash (63%) and digital wallets requiring cash or card top-ups (49%).
This shift towards real-time payments has been dramatically accelerated by changing payment necessities and preferences caused by the COVID-19 pandemic. Four in ten consumers (40%) in Thailand have reduced their usage of payment methods such as cash, credit cards and debit cards since the onset of COVID-19. As a result, two thirds (66%) are now using real-time payments more than they were prior to the pandemic.
Due to rapid technological change, consumers now expect mobile-first and real-time experiences — however, payments have often lagged. The development of real-time payments systems enables consumers, merchants, and financial institutions to pay friends and customers, settle bills and transfer money instantaneously. While cash has always represented an “immediate” mode of payment, the advent of real-time payment rails brings this concept into the digital age with faster settlement periods, notifications, and consolidated reporting.
“This fundamental shift in consumer demand and payment expectations sets forth a challenge for Southeast Asia’s banks, financial institutions and merchants,” said Leslie Choo, managing director – Asia, ACI Worldwide. “These organisations can ill-afford to put their modernization 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 in Thailand expect the benefits of using real-time payments domestically 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:
- Two thirds (66%) of Thai consumers who have travelled internationally in the past expect their usage of real-time payments to increase when they next travel.
- 70 percent say the ability to use their preferred payment methods while travelling abroad will be more important now. As a result, more than a third (35%) expect their usage of traditional payment methods such as cash to reduce when they next travel.
- Three quarters (74%) say payment safety and fraud prevention are more important now, while more than two thirds (68%) say transparency of interchange rates is now of greater importance.
While the number of Thai consumers who are making international eCommerce purchases has increased over the past year, consumers are looking for further guarantees about payments to encourage them to do so more in the future:
- More than a quarter (27%) of consumers are shopping more with merchants based in other Southeast Asia countries since the start of the pandemic, while a similar number (26%) are shopping more in stores outside of Southeast Asia.
- The most popular factors that would encourage these shoppers to purchase products and services more regularly from international sellers are:
- Ability to pay with preferred domestic payment method (32%)
- Having a wider range of payment options than is available at present (25%)
- Reassurance that payment and personal data is safely transmitted, secured and stored by international sellers (25%)
“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,” added Choo. “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.”
Find out more about consumer real-time payment preferences, and about how financial institutions and merchants in Southeast Asia can become real-time-ready, in the full report: Real-Time Goes Mainstream
Methodology:
The YouGov study was conducted during April 2021 on a nationally representative basis across Indonesia (2,000 consumers), Thailand (2,000 consumers), Singapore (1,000 consumers), and Malaysia (1,000 consumers.
Source: FAQ