By Rajkishore Agrawal, Senior Director, Head of Sales, Southeast Asia at PayPal
It is easy to understate the impact of COVID-19 to the future of business. For certain industries, like retail, it is difficult to simplify just how big a change the pandemic has ignited.
The crisis has accelerated digital payment adoption at a rapid pace. What experts previously predicted to happen in years is now on track to being embraced in months.
Driven by social distancing protocols, shoppers across Southeast Asia have gone from wandering aisles to browsing websites. It is equally important to note that these new consumer habits are taking root and will likely persist, as online shopping becomes the norm even after lockdown measures are lifted.
While there are many countries in SEA where cash remains the preferred method of payment, what we’re seeing now is a behavioral shift to digital across multiple transaction decisions—from food deliveries to grocery shopping to bill payments.
In the Philippines, the result of PayPal’s recent 2020 PH Consumer Survey revealed that 87 percent of Filipinos have increased their usage of digital payment platforms during the pandemic, with 9 in 10 preferring to pay digitally instead of with cash during this time.
These trends are palpable across numerous countries in SEA. According to a report, nearly half of Malaysian consumers have increased their online shopping activities. The same report also cited that Malaysia leads other countries in SEA when it comes to using e-wallets at 40 percent, ahead of the Philippines (36 percent), Thailand (27 percent), and Singapore (26 percent).
Mobile commerce drives digital payments across SEA
A common trend across SEA is that mobile is fast becoming the preferred channel for e-commerce, especially amongst younger shoppers. And their use of mobile apps and e-wallets is driving demand for in-app payment solutions.
In the Philippines, there were 173.2 million mobile connections in January 2020, an increase of 28 percent from January 2019 and equivalent to 159 percent of the total population. This makes it one of the fastest growing e-commerce markets in Asia.
From necessity to trust
Across Southeast Asia, digital payments are fast gaining currency as people ditch cash to avoid physical contact on worries over catching COVID-19, but continuous use will always be anchored on the fundamental principles of trust and security. Consumers need to be able to trust financial services providers to secure their money.
In the Philippines, the PayPal 2020 PH Consumer Survey also shows that almost half (49 percent) identified security as the topmost consideration when choosing which digital payment platforms to use. And this rings true for many online consumers from other countries as well.
At PayPal, our mission is to give our 325 million active account holders across the globe the confidence to connect and transact whether they are online, on mobile, in an app, or even in person. Our goal is to offer people better ways to manage and move money, across 200 markets and in different currencies.
Trust is foundational to our business—making security a top priority for our organization. PayPal uses 24/7 transaction monitoring, anti-fraud technologies, and Buyer Protection, enabling users to transact with peace of mind.
A new world of global opportunities
There’s now an unparalleled urgency for merchants to be proactive in the usage of digital payments, and this unlocks a new world of global opportunities. At the same time, digital payments also open the door for more choices for consumers, as cross-border shopping becomes a seamless experience.
Now more than ever, individuals and businesses need to stay connected to the online economy as the pandemic leads to a digital shift in our way of life. For us at PayPal, this means doubling down on our commitment to make payment experiences as frictionless and secure as possible.
