According to the 2022 Global Payments study, conducted by the American financial services company Fidelity National Information Services (FIS), digital wallets will be more popular than credit cards in Hong Kong in the near future in the e-commerce sector. -trade.
Outperform credit cards
A digital wallet is an electronic financial account that allows users to store funds, make payments, and track transactions online through an app. In Hong Kong, their usefulness was especially revealed during the Covid-19 crisis, with more and more inhabitants of the metropolis who adopted them during this period.
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Digital wallets are so popular in Hong Kong that they are expected to account for 40% of e-commerce transaction value by 2025, surpassing credit cards. This trend is very good news for companies providing digital wallets; in Hong Kong, the top four industry players are Alipay, WeChat Pay, Tap & Go and Octopus.
Between them, these four apps had more than 4.7 million users and 96,000 merchants in Hong Kong by the end of 2021. As explained by the South China Morning Postlocal promotions from e-commerce giant Alibaba, as well as Hong Kong Technology Venture Co subsidiary HKTV Mall, have helped broaden the adoption of digital wallets in the city.
Hong Kong authorities are trying to boost the adoption of the digital wallet. Photography: Ruslan Bardash / Unsplash
A digital currency in Hong Kong soon?
The increase in the use of this means of payment bodes very well for e-commerce in Hong Kong. According to the study by the firm FIS, this market should grow by 10% per year over a period of five years to reach 31.2 billion dollars in 2025. However, payments by credit card should remain the majority in the traditional stores and represent more than 50% of the value of transactions there in 2025.
More broadly, the growing adoption of digital wallets is also being boosted by the efforts of Hong Kong authorities, who are set to distribute HK$10,000 (US$1,277) in new digital checks to 6.3 million eligible residents from next month. The government carried out a similar maneuver recently, which boosted growth by at least 0.7%.
In addition to encouraging residents to adopt the digital wallet, this measure also prepares them for the digital transformation that is taking place in depth in the Asian city. Like China and its digital yuan, Hong Kong is indeed exploring the possibility of deploying its own digital currency which would be called e-HKD. Moreover, more than a third of residents of the metropolis said that they would use cryptocurrencies or digital currencies issued by the central bank in the next five years.