Jacquelyn Tan, Head of Personal Financial Services, United Overseas Bank (UOB), in Lianhe Zaobao (March 5, 2021)
Summary by Alan Yang Gregory
The use of cash in Singapore is declining – but at a slow pace. Since the Covid-19 crisis, the use of digital payments has grown. The total value of transactions made by United Overseas Bank (UOB) customers through PayNow service increased by 220 percent in the first 10 months of 2020. Singapore must see this as an opportunity to promote further the growth of digital payments.
In recent years, Singapore’s government has strongly supported the development of digital payments. In April 2019, the Land Transport Authority, UOB and other partners jointly launched the SimplyGo service, which allows passengers to use credit or debit cards to pay for bus or subway fares. During the pandemic, 1,000 ambassadors were recruited to teach the public how to use digital tools.
For consumers, the use of digital payment means that there is no need to count money, making shopping more convenient and transparent. For merchants, eliminating paper payments and manual processes means saving costs and improving efficiency and the consumer experience. When it comes to ensuring public health and safety, digital payments offer a huge advantage. Another key benefit of using digital payment relates to security. Financial institutions can protect digital payment users from losses caused by unauthorized or erroneous transactions.
Despite these benefits, old habits remain a stumbling block for Singapore to move towards a cashless society. Among them, "muscle memory" plays an important role in payment. When consumers start to use digital payments, the reflex habit will develop. The government and businesses should work to encourage consumers to adopt digital payments. Providing incentives and adding simple digital payment options to shopping can speed up adoption. This all requires close cooperation among banks, merchants and the government.
The Covid-19 pandemic has provided a unique opportunity to the payment industry, which Singapore must seize.