(Hong Kong, 27 July 2023) The Hong Kong Productivity Council (HKPC) releases the results of its “Enterprise Digital Payment Landscape Study” today, to provide a comprehensive view of the current state of enterprise payments, identify key trends and emerging opportunities for businesses, and investigate the underlying forces behind such trends.
The survey, conducted independently by HKPC and sponsored by Visa, found that business-to-consumer (B2C) enterprises accept 5.6 payment methods on average, of which 4.1 are digital payment methods. Notably, 70% of them accept Faster Payment System (FPS), 67% accept credit card and 61% accept Mobile QR. In comparison, there is still room for wider adoption among business-to-business (B2B) enterprises, where 2.1 digital payment methods on average are accepted.
In addition, 51% of the Hong Kong’s B2C enterprises are satisfied with the overall performance of digital payment tools, compared to 41% for B2B enterprises. B2C and B2B enterprises could both benefit from the further development of cross-border and multi-currency payment acceptance.
Looking into the results by business nature, B2C enterprises in Hong Kong have made significant strides in digitalising payment methods to meet local consumers’ needs, while efficiency and traceability are the key factors driving satisfaction of these digital payment tools. The results also illustrated that limited available options for cross-border consumer payments may pose a barrier for B2C enterprises’ expansion into other markets. These B2C enterprises also exhibit higher expectations towards enhanced payment security.
Corporate payment and supplier payment are largely conducted via traditional payment methods such as wire transfer, cheque, and in-person bank transfer. Cross-border payments are mainly processed via online wire transfer. Based on the survey findings, the underperformance in handling cross-border payment, accepting multiple currencies and managing transaction safety are the key issues leading to dissatisfaction towards B2B digital payment tools in Hong Kong.
Mr Alex CHAN, General Manager, Digital Transformation Division of HKPC, said, “The development of e-commerce and the transformation of consumers' shopping behaviour have accelerated the digitalisation of payment methods in Hong Kong, as witnessed by the flourishing consumer payment landscape with the wide adoption of ‘new’ digital payment tools including FPS and Mobile QR among B2C enterprises for local consumer payment. However, the payment digitalisation process of corporate payment is comparatively behind. It is hoped that new technologies such as blockchain, digital currency and smart contract can further promote the development of the payment industry, providing users of B2B payment with more payment options. Although Hong Kong’s adoption of digital payment is not behind other markets, enterprises are calling for greater payment optionality, with 70% agreeing that customers should be able to choose their desired payment methods regardless of amount or merchant size. Also, as Hong Kong forges greater ties with the Mainland and other parts of the world, the findings revealed an urgent need to increase the payment options for cross-border payment and acceptance for both B2C and B2B enterprises, to facilitate local companies to go international through more seamless payments with less hassles.”
In terms of the enterprises’ plans to advance their payment tools, three-fourths (74%) of surveyed enterprises are currently making changes or planning to make changes to their payment and receivable methods, with “enhancing security during transaction” (62%) and “increasing number of payment methods” (53%) being key areas of focus in the next two years. Of the remaining 26% of enterprises not planning to make advancements to their payment method, half believe they would be more incentivised by the combined efforts of all parties in the financial ecosystem.
Mr CHAN added, “The above findings reinforced the call for increasing payment optionality for enterprises, and highlighted the level of expectation towards transaction safety and providing more seamless payment experiences. Developing better digital payment tools for security while fortifying multi-currency acceptance will help mitigate the gap in expectation, but it requires the collaborative efforts from the whole financial ecosystem. In addition to support from the ecosystem, businesses themselves need to be more open-minded in embracing new payment tools, as the survey found that six in 10 B2B enterprises that are not accepting new payment solutions are keen to stick with their current payment methods despite their call for more payment options, which poses an obstacle to the development of payment tools in the long-run. Currently, close to two-thirds of the surveyed enterprises hold a positive or neutral view that Hong Kong can become cashless in five years. With the collaboration from the whole financial ecosystem and enterprises, it is optimistic that Hong Kong can accelerate the development trend of digital payment, promoting the digital economy and implementing the digital transformation of society.”
Using virtual credit corporate card as proxy, the survey also gauged enterprises’ awareness of some new digital payment methods, as well as their preference towards these features. It was found that despite the low awareness, enterprises appreciate the various fintech-driven benefits delivered by the virtual credit card, including cost savings for overseas remittance, real-time expense reporting and analysis, and its ability to pre-set credit limit to avoid cashflow issues.
Ms Paulina LEONG, General Manager, Visa Hong Kong and Macau, said, “As the digitalisation of money movement accelerates, we are helping to spur modernisation of enterprise payment processes to match the seamless experiences in consumer payments. Our research with HKPC underscores the pressing need for this transformation. As a trusted network, Visa facilitates digital money movement by collaborating with financial institutions, fintech and technology partners to help empower businesses of all sizes with tools and resources to run their operations and enjoy the benefits of the digital economy.
“The time has never been better for businesses to take advantage of new payment technologies to streamline their most fundamental processes needed to run their businesses. At Visa, we are constantly innovating to uplift people and businesses everywhere by being the best way to pay and be paid.” added Ms LEONG.
The “Enterprise Digital Payment Landscape Study” was conducted in February and March this year. A total of 821 enterprises were interviewed by telephone, compromising 356 B2C enterprises and 465 B2B enterprises. For more information about the results of the survey, please click here.
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1Note: Digital payment methods covered in this survey include FPS, Octopus, Credit Card, Mobile QR (e.g. WeChat Pay, Alipay, Tap & Go, PayMe), mobile contactless (e.g. Apply Pay, Google Pay, Samsung Pay) and PayPal.
2Note: “Credit card” does not include the use of credit cards to make payments via PayPal.