PayPal study finds cash is still king in Asia

Finance


The report, which surveyed about 4,000 people across China, India, Hong Kong, Singapore, Thailand, Philippines and Indonesia, also found that despite the preference for cash, awareness of newer methods of payments was high.

Nearly half said they were familiar with digital wallets and 23 percent said they knew what contactless payments using credit or debit cards was, with another 23 percent saying they understood what making contactless payment via mobile phones meant.

“There’s a lot of awareness of digital wallets, but engagement is much, much lower and there’s a big gap,” Rohan Mahadevan, senior vice president for Asia Pacific at PayPal, told CNBC.

That was despite some of the common problems people said they had with cash or credit and debit card transactions, including not having enough cash on hand, lack of easy access to ATMs, long queues in banks or even fees for late payments.

Mahadevan pointed to several reasons why many people still preferred using cash.

First, there wasn’t enough information about each digital payment method, he said. For example, there are various e-wallets, such as PayPal, and also in-app payment systems, such as GrabPay or Uber pay, or digital currencies, including bitcoin.

Yet, many people don’t have a clear understanding of what each payment option does and what kind of value it can provide, Mahadevan said. Conversely, cash is a straight-forward option in use for centuries.

The complexity of setting up a digital wallet or any other online-payment method, such as additional security measures, could also turn people away from using them, according to Mahadevan.

On top of that, concerns over privacy were always a priority, with users wondering if their financial records will be kept safe, he said.



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