(Hong Kong, 19 February 2019) The Hong Kong Productivity Council (HKPC) today announced the latest findings of the "AlipayHK Smart Payment Popularity Index" (SPP Index), reporting an Overall Index at 62.2 (maximum being 100) for the second half of 2018, up 8.3 points from its inaugural release six months ago, contributed by both Retailers’ and Consumers’ wider acceptance. The results reflect a steady progress of "Smart Payment" development in Hong Kong, with its application in local transportation to further promote its popularity.
Comprising the "Retailer Smart Payment Readiness Level" and the "Consumer Smart Payment Acceptance Level", the SPP Index aims to evaluate the popularity of smart payment in Hong Kong from the perspectives of both retailers and consumers. It found that "Retailer Smart Payment Readiness Level" rose 6.0 points to 68.6 when compared to six months earlier. All its four component sub-indices went up, with the most significant increment in "willingness to adopt smart payment" (76.7) sub-index, up 15.5 points from half year ago. Amongst the surveyed types of retail outlets, the readiness level of "Medicines and Cosmetics" (74.8) ranked the highest. Similar to the previous results, around 95% of the surveyed retailers provide non-cash payment channels, with credit card (86%) still being the mostly adopted means, followed by mobile payment (60%), which increased 17% from the last survey.
On the other hand, "Consumer Smart Payment Acceptance Level" rose from 45.5 to 55.9, with all its four component sub-indices up simultaneously. Yet, both "Confidence in payment security" (42.0) and "Habits in using smart payment and relevant device" (44.7) sub-indices are still below the 50-mark. Those aged 25-34 were still most receptive to the notion of smart payment (63.9). A significant improvement was also noted among the 50-64 age group, which increased 14.2 to 46.4. About half (48%) of the respondents had mobile payment experience, compared to less than 30% six months earlier. "Not familiar with operation" (69%) and "worries of personal data leakage" (62%) remained their key hindrances to its wider use.
This survey also gauged their views towards e-payment in transportation, which most (87%) wish that transportation expenses can earn the same benefits and rewards as general consumption. Reasons for not attempting include lengthy preparation time expected (69%); habitual use of physical cards (55%); and worries about long transaction time (53%). If available, 47% of respondents are willing to try other e-payments means (such as NFC or QR code) for transportation. Also, 45% fear that such e-payment channels may not qualify for government subsidies on public transportation, and they are hoping to see more smart payment options for transport.
Mr Edmond Lai, Director (Digital) of HKPC, said, "Digital transformation has been a new norm for various sectors. We are happy to see the increasing acceptance of smart payment at retailers. This represents retailers’ willingness to become more digitised, so as to enhance the operations efficiency at large. These contribute to the development of smart city via versatile payment solutions and hence solve the consumers’ pain-points. HKPC is ready to provide professional technical consultancies for retailers or SMEs that wishes to digitise their operations. Through technology upgrade and getting ready to accept smart payment, companies can further increase their competitiveness in the wave of Enterprise 4.0."
The survey also studied the outbound travel payment habits and revealed that 90% of respondents travelled at least once in 2018, with Mainland China (64%), Japan (32%) and Taiwan (24%) being their top three destinations; 65% percent of the respondents said that they often have too many large-denomination notes when they exchange foreign currency, and 70% think that it is a nightmare to deal with small-denomination coins of foreign currency during travel. At the same time, 60% will try to avoid using credit cards outside Hong Kong. In addition, nearly half of them are willing to try out the outbound e-payment features provided by local e-wallet suppliers. On the other hand, those who are unwilling to try it have cited "concerns on cybersecurity in outbound districts" (79%), "worries on losing their mobile" (68%) and "worries on network connectivity" (58%) as the main reasons for their reluctance.
In response to the rapid development of e-payment in outbound travel and transportation, around 70% of the surveyed retailers expect significant increase in the demand for mobile payment will be increased significantly. Also, among those planning to provide mobile payment channels in their stores, around half of the responding retailers will place priority to those channels with features of e-payments in outbound travel and transportation e-payment functions.
Jennifer Tan, CEO of Alipay Payment Services (HK) Limited, said, "We’re glad to witness a significant rise in the AlipayHK Smart Payment Popularity Index. This reflects the popularisation of smart payment in Hong Kong and public recognition of the efforts of AlipayHK and its peers to promote smart payment locally. The survey has shown pressing public demand for smart payment in transport and travel which in fact will be AlipayHK’s development focus for this year. We look forward to expanding EasyGo to more public light bus routes and other transport modes, offering the public an additional convenient payment option. We also hope to launch cross-border payment function in the near future to extend smart consumption experience to beyond Hong Kong."
In this latest survey, telephone interviews with 404 retailers and 1,021 Hong Kong residents aged between 15 and 64 were conducted between November and December 2018.
The complete report of "AlipayHK Smart Payment Popularity Index" can be downloaded from http://u.hkpc.org/HKSPPI2018H2.
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