Visa Study: Over 70% of Malaysians supportive of a cashless country
By Digital News Asia May 15, 2020
- 69% of Malaysian respondents plan to use cashless payments more often
- Contactless card payments gain traction; 85% use them at least once a week
It would seem that Malaysians are keen to enter a cashless society. According to the latest findings from Visa’s Consumer Payments Study, more than seven in ten Malaysians are supportive for the country to become a cashless society. Furthermore, 62% believe that it can be achieved within the next five years.
If anything, it’s good news for the country, as the migration into electronic payments is a key part of Malaysia’s Financial Sector Blueprint, which charts the direction of the financial system over the next ten years.
As for why consumers are vying for a cashless society, the top three benefits they believe going cashless will offer include “tracking financial records easily”, “removing the hassle of having to queue at banks” and “enabling the country to become more efficient.”
Additionally, the study found that 69% of Malaysian respondents are planning to use cashless payment methods more often, and move away from cash. This trend is more apparent amongst the affluent segment, where 77% indicated interest to do so.
The top reasons for the potential increase in digital payments usage are due to convenience and wider acceptance of digital payments in the country.
“It is heartening to see the increase in digital payments usage by Malaysians in the country, especially contactless payments. This is aligned with our data, where close to half of all Visa face-to-face payments are contactless payments,” says Visa country manager for Malaysia, Ng Kong Boon (pic, above).
“In addition, Malaysia is one of the fastest growing countries in Asia Pacific in terms of contactless penetration and we are confident this growth will continue as we expand into new merchant category segments.”
Visa’s study also found that nearly two in five respondents stated that they are carrying less cash compared to two years ago. 69% of respondents cited this was due to more merchants adopting cashless payments, while 65% indicated it was due to safety concerns.
On top of that, the study discovered that contactless card payments are also gaining momentum in the country. 65% of Malaysian respondents have used contactless payments, and 85% of them make contactless payments at least once a week. 82% have also been using them more frequently compared to two years ago.
The reasons cited here is the belief that contactless payments enable them to not carry cash around, and is a faster mode of payment compared to other solutions.
Despite this, cash is till king in Malaysia. According to Nielsen in its The Malaysian Payment Landscape study 2018, while 63% of Malaysians have a debit card, its usage for day-to-day expenses remain low as consumers still heavily rely on cash. 93% prefer cash when they dine out, while 90% use cash when they buy groceries. 89% use cash for public transport, while 81% use them for petrol.
Acknowledging that cash still rules in the country, Ng, nonetheless is adamant that Malaysia is heading in the right direction.
“Despite the growth in digital payments usage by Malaysians, there are still tremendous opportunities in Malaysia for cash displacement. We are seeing a proliferation of various payment solutions being introduced which may accelerate the use of digital payments,” he adds.
“However, it may also cause the payment industry to be more fragmented so it is crucial for us to work closely with the banks, merchants and the fintech community to ensure the solutions we’re creating are interoperable so it can drive greater adoption amongst Malaysians.”