SINGAPORE (Dec 13): The continuous and rapid advancement in smartphone and financial technology has brought about an increase in mobile payment usage in recent years.
Ever since the introduction of PayLah!, a smartphone-based quick response (QR) code payment technology in Singapore, the use of mobile payments has doubled in the country, according to a study conducted by the National University of Singapore (NUS) Business School.
The study also found that consumers use mobile wallets mostly for small-amount transactions. And the weekly count of these transactions of less than $100 surged by 114%, while larger transactions of more than $100 has increased by 88%.
According to Statista, the transaction value of mobile point of sale (POS) payments in Singapore more than doubled to US$470 million by the end of 2017 from US$218 million in 2016.
On the merchant side, small merchants saw a significant increase in monthly card sales amount by 7% after they have adopted the QR code technology. These merchants also saw credit and debit card sales increasing significantly compared to large merchants after the QR code was implemented.
For new entrepreneurs, the implementation of QR code has helped them benefit more from the low-cost and convenience offered. The study found that newly established small stores increased monthly card sales amount by 11%, compared with 2.1% growth among the more established small merchants.
However, the study did not find obvious findings that the introduction of the QR code has helped them to increase sales. The convenience and efficiency of the payment technology promoted sales growth primarily for new businesses by facilitating customer acquisition.
“The development of mobile payments plays a critical role in Singapore’s goal of becoming a cashless society,” said Professor Sumit Agarwal. “The findings also provide important input for discussions about fintech and digitisation by offering new insights on the real economic effect of improved payment convenience and efficiency.”