Industry Research

Pandemic pushes more than 80% growth for e-wallet players

THE Covid-19 has resulted in more than 80% growth for e-wallet usage in the country, as limited movement pushes cashless payments among Malaysians in the past 18 months.

 

Based on Google’s e-Conomy South-East Asia 2020 report, e-wallets transactions rose to an average of 25% post-Covid-19, indicating that consumers will continue to use digital payments, given their convenience.

 

In fact, Malaysians recorded an average of 170 digital payments in 2020 and a report by Boku Inc highlighted that e-wallets are the most preferred payment method among consumers in South-East Asia.

 

Finance Minister Tengku Datuk Seri Zafrul Tengku Abdul Aziz had noted in his opening keynote address at the recent Malaysian Banking and Finance Summit 2021 that e-wallet volume has increased 89% to 468 million transactions in just one year up to June 2021.

 

TNG Digital Sdn Bhd CEO Ignatius Ong told The Malaysian Reserve (TMR) that as of the first half of 2021 (1H21), online use cases grew by 86% compared to the post eTunai and ePenjana period (in 2020) versus offline use cases with an increase of 75%.

 

“We observed that more users are actively transferring e-money within our Touch ‘n Go eWallet ecosystem compared to a year ago, where the ‘Transfer’ feature recorded an increase of 182%.

 

“The pandemic and the enforcement of the Movement Control Orders have boosted the adoption of e-wallet as the situation has pushed consumers into cashless payments with their new shopping and payment habits,” he said in a recent interview.

 

“The eWallet is secure, with advanced security solutions such as biometric authentication that can reduce the threat of fraud and chargebacks.

 

“There are also fewer steps to complete a purchase on the eWallet. Additionally, businesses can offer more rewards on the eWallet while users benefit from discounts or reward points,” he said.

 

Ong added that e-wallet is suitable as an everyday wallet and plays a crucial part in the “new normal”.

 

E-wallet usage has become essential for purchasing goods, settling bills, food delivery, road tax renewal, insurance purchase, mobile reloads and more.

 

Additionally, he said Touch ‘n Go eWallet users can also track their spending easily as the eWallet records all transactions digitally and automatically.

 

He pointed out that merchants were also quick to adopt and embrace the trend as more consumers embraced the usage of e-wallets.

 

“Touch ‘n Go eWallet currently has more than one million merchants touchpoints, including DuitNow QR, the national QR standard.

 

“At Touch ‘n Go, we encourage more onboarding for small and medium enterprises (SMEs), and micro-merchants to adopt the e-commerce and e-payment platforms as it allows them to access more than 16 million users across Malaysia,” Ong said.

 

The firm launched the DuitNow Transfer function yesterday, allowing its users to move their monies from any Internet banking account directly to the eWallet in real-time.

 

Meanwhile, Boost CEO Sheyantha Abeykoon stated that for 18 months from January 2020 to June 2021, Boost eWallet merchant base increased by over 85%.

 

He said about 50% of the platform’s new merchants consist of traditional cash-based micro, SMEs.

 

“During the period, our user base grew by over 76% and our gross transaction value for payments made to online merchants increased by over 35%.

 

“At the start of the pandemic, our offline QR code-based transactions accounted for almost 70% of our domestic payment volumes and online volumes were 30%.

 

“By mid-2021, we saw a huge shift and 65% of our payment volumes were generated by online use cases,” he told TMR.

 

According to him, Boost previously had over 9.3 million users and the platform user base grew by over 76% over the 18-month pandemic period of January 2020 to June 2021.

 

He added that consumers have opted for safer and more seamless means of transacting as the pandemic raged on.

 

“For instance, by the end of 2020, we saw a steep 75% increase in our user base and a 65% increase in our merchant base, which was representative of the desire to shift to cashless payment options.

 

“We believe that some of these trends, in particular, the usage of contactless payments and adoption of digitised means of operating for small business will outlast the pandemic and represent structural shifts in the behaviour of our customers,” he said.

 

He added that Boost eWallet saw a 40% increase in bill payment on the platform in 1H21 compared to 1H20.

 

“Partnerships and collaborations also drove e-wallet adoption. Malaysians were already becoming accustomed to online shopping by then, so the addition of our e-wallet as a payment option made it a convenient choice for customers.

 

“Additionally, business owners also played a big role in driving e-wallet adoption. Businesses needed to adapt to the pandemic and our merchants took our service well and it helped drive the e-wallet usage,” he noted.

 

Apart from that, Abeykoon said another aspect of the new normal is the use of QR codes being synonymous or second nature with our lifestyle now.

 

He emphasised that our daily outdoor activities involve scanning a QR code to check-in and check-out wherever we go using the MySejahtera app, and this has helped Malaysians familiarise themselves with scanning QR codes.

 

He also noted that offline e-wallet payments primarily use QR codes which made it familiar for new e-wallet users to come on board.

 

SourceThe Malaysian Reserve

 

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