Singapore is stepping up push towards digital payment with the reduction of cash withdrawals from automated teller machines (ATMs) and elimination of cheques by 2025.
According to the country’s education minister, Ong Ye Kung, who is also a board member of the Monetary Authority of Singapore, explained at the 45th annual dinner of the Association of Banks in Singapore (ABS), that the goal is to protect consumers from e-payment risks.
The government is also hoping that the latest step will encourage more Singaporeans to adopt epayment technology.
“Our aim is not to be a cashless society, but to use less cash and more e-payments,” Kung said. “When the level of convenience and confidence crosses a critical tipping point, adoption will rise across our population within a short time and become pervasive.”
Presently, more than 8 in 10 Singapore consumers have adopted e-payments and nearly three in five merchants are compliant. The value of e-payments has been growing by more than $10 billion every year.
The country has also seen a drop of more than $300 million in ATM cash withdrawals. In 2015, customers’ cash withdrawals were almost 60 percent of e-payment transaction values. But this went down about 40 percent in 2017.
Ong Ye Kung disclosed that the government hopes to reduce the number further to 20 percent in 2020. It also wants to cut cheque usage to 15 percent in 2020 and become an entirely cheque-free society by 2025.
Analysts also believe that the country is accelerating the push to enhance its position as a regional financial hub and be able to compete with other major cities including Hong Kong and London. A Bloomberg report revealed that local competition has also intensified as its largest bank DBS Group Holdings Limited engage ride-hailing service Grab for digital payments. There is also potential competition from Chinese digital payment giant Ant Financial which is planning to expand its services in Southeast Asia.
PayNow, the biggest service in Singapore, is reported to have over 1.4 million registered users who have transferred nearly $662 million since the service launched in 2017.
