- Singapore the 6th country in the world and the first in SEA to adopt Apple Pay
- Impact expected to be the same as algorithm trading in the investment market
FIVE major banks in Singapore recently signed up to Apple Pay, a digital wallet service that enables iPhone, iPad, or Apple Watch users to pay for goods and services using their digital devices instead of a credit or debit card.
Before this announcement, its availability was limited to holders of American Express-issued cards.
However, customers of POSB, DBS Bank, OCBC Bank, United Overseas Bank (UOB) and Standard Chartered Bank can now take advantage of Apple Pay. Collectively, these financial institutions account for more than 80% of the Visa and MasterCard credit and debit cards issued in Singapore.
It remains to be seen whether consumer spending will increase as a result of Apple Pay’s introduction, with analysts predicting a slow uptake.
But whichever way the mobile-payments market goes, financial investors feel it is only a matter of time before consumers start to realise the benefits of cutting-edge technology, just as they have with algorithm trading in the investment market.
Apple Pay in Singapore
With Apple Pay, users can register a credit card on their iPhone, iPad or Watch and then pay for goods or services by swiping the device over a contactless terminal.
Just like the EZ-Link stored-value card and Visa payWave credit and debit cards, Apple Pay uses wireless near-field communication (NFC) technology to transmit data between the device and payment reader.
Jennifer Bailey, vice president of Apple Pay, told The Straits Times: “Now, almost everyone can leave their wallets at home. Apple Pay will be a natural extension of what users have been doing at payment counters.”
Visa says that a third of all its credit and debit card transactions in Singapore at brick-and-mortar stores are contactless, while around 30,000 retail points such as Fair Price, Cold Storage, Guardian, Starbucks, and Uniqlo allow for payments without a PIN (personal identification number).
But while several analysts say it might take a bit of time for Apple Pay to catch on, consumers in Singapore won’t think twice about digital wallets and mobile payments in the years to come.
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Slow adoption followed by widespread acceptance
Singapore is the sixth country in the world and the first in South-East Asia to adopt Apple Pay.
However, EZ-Link chief Nicholas Lee believes that several consumers may struggle to change payment tendencies.
“NFC in Singapore has not been taken up in a big way yet, and it remains to be seen how people will take to using mobile phones to pay, instead of using cards as they have been used to,” he said.
Although Forrester researcher Ng Zhi Ying shared a similar opinion, she felt that technology, in particular digital wallets, would eventually have a big influence on consumer spending.
She explains: “Consumers can choose from a wider variety of digital-wallet providers and these providers can test and learn from what works with consumers and provides them with greater value.”
Greater value is something that investors and analysts are already benefitting from with algorithmic trading, which allows for testing as well but also reduces the possibility of mistakes by automatically making trades at a specific price or trigger.
This advance is already taking hold in financial circles, much like Apple Pay could when it comes to contactless payments.
Freelance writer Sophie Davidson is passionate about providing engaging content and has featured in a number of online publications. She is reachable at [email protected].
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