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Mobile payments linked to credit cards on the rise in Singapore despite security concerns: Survey

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Credit card holders here are increasingly using card-linked but card-less mobile apps or wallets for their purchases, according to a survey by research firm JD Power.

CREDIT card holders here are increasingly using card-linked but card-less mobile apps or wallets for their purchases, according to a survey by research firm JD Power.

The study found that with so many payment options available, the credit card remains Singapore's most popular mode of payment at stores and restaurants and for online purchases.

But usage of mobile wallets to make credit card payments here has jumped 53 per cent - with 40 per cent of card holders having done so this year compared to just 26 per cent in 2016.

That level is significantly higher than in the United States (23 per cent) and Australia (14 per cent) and on par with Hong Kong (41 per cent), despite the fact that security is the concern most often cited by consumers for not using a mobile wallet.

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"Singapore cardholders are increasingly moving toward mobile payment platforms," said Anthony Chiam, service industry practice lead at JD Power. "However, in order for cardholders to fully embrace the adoption of these services, trust is paramount and security concerns must be first addressed."

Low merchant acceptance at retail stores and restaurants is another key reason why cardholders here do not link their credit cards to mobile wallets or apps like Apple Pay or Samsung pay, which store your card information in a digital form so you can pay with your smartphone or tablet, the survey found.

Another interesting finding is just how much sway a credit card's programme of rewards and loyalty points has.

More than three-fourths (79 per cent) of cardholders choose a card with a rewards programme and they end up spending on average 29 per cent more - S$1,035 versus S$802 per month for those without rewards or loyalty points.

Still, the biggest factor for customers when choosing their primary credit card is its cashback feature, followed by the rewards programme and discounts and promotions.

In JD Power's survey, American Express scored the highest in credit card satisfaction, with Standard Chartered ranked second and DBS coming in third. Customer satisfaction is scored across six factors: interaction, billing and payment, credit card terms, benefits and services, rewards and problem resolution.

The survey was based on responses from 2,903 credit card customers.

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