E-Wallets are developed to increase 'stickiness' with consumers by providing personalized and localized offerings in each country.
Did you know that in 2021, e-wallet payments made up 44.5% of e-commerce transactions? And yes, we know that's a lot of e's.
But more importantly, e-wallets are set to become increasingly popular in the days to come - and with good reason.
E-wallets, or digital wallets as they're sometimes known, are a quick and convenient way for customers to go cashless.
Although digital wallets were slowly gaining traction several years ago - all of this went into overdrive after the outbreak of COVID. Mostly due partly to mandatory social distancing measures and fears of transmitting COVID via touch.
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5 Things to Know About E-Wallets
What are e-wallets?
E-wallets or digital wallets are mobile applications that allow users to store funds (usually in local currency), perform transactions, and make payments in one click.
They provide localized offerings according to each Southeast Asian country and personalize them to each consumer behavior, allowing consumers to earn tangible rewards from every day's spending.
This in turn creates 'stickiness' and increases the reliance on e-wallets from consumers.
How do e-wallets work?
The same as a regular wallet.
The difference here is that e-wallets are topped up via bank transfers or debit/credit cards. A physical regular wallet is topped up with cash. Some e-wallets in the Philippines can be topped up with cash or real-time.
Can I transfer money from an e-wallet to a bank account?
Yes, you can.
Most e-wallets allow transfers to and fro from your bank account, or are connected to your credit/debit cards.
Which e-wallet is best?
There aren't any "best" wallets per se. It primarily depends on what you want.
Remember: it's always a good idea to ask around before deciding.
Southeast Asia: Top 3 E-Wallets in Each Of These Countries
And while cashless payments have proven to be popular in many countries, Southeast Asia is one region where e-wallets have dominated the market.
Hence, if your organization is looking to break new ground, here's a breakdown of the top e-wallets in South East Asia.
Also known as the Lion City, Singapore is Southeast Asia's tech and financial hub. With a mobile penetration rate of more than 140% on average, it should come as no surprise that 1 out of every 3 Singaporeans owns and uses mobile wallets every day.
Coming in at first place in Singapore, we have DBS PayLah! - a mobile wallet payment platform offered by DBS bank. And as most Singaporeans have a DBS account, it's easy to see why PayLah! has been such a hit.
With PayLah!, users can pay for goods and services, transfer funds to bank accounts, and earn reward points.
A household name familiar to most Singaporeans, Malaysians, and Indonesians, Grabpay is owned by the tech super app company Grab.
While DBS PayLah! may be the dominant e-wallet in Singapore, GrabPay hasn't made it easy for DBS to stay on top.
GrabPay lets users pay for rides, order food, shop for groceries, and purchase goods and services.
On an interesting note, GrabPay also provides financial services in the form of PayLater. This feature allows users to split their purchases into 4 interest-free installments or enjoy 30-days credit.
Fave first began life in 2015 as a social commerce platform that offered vouchers and promotions at their partner retail outlets.
Since then, the Malaysia-based fintech firm has expanded into the financial services market with FavePay; a mobile payment system similar to a real-time payments platform.
But the difference here is that FavePay allows customers to earn cashbacks with every purchase.
At the same time, the platform also provides microfinancing with its “Buy Now, Pay Later” (BNPL) service known as FavePay later.
Regarded as a melting pot of cultures, Malaysia is blessed with a highly-diversified economy and sizable middle class.
The country has also been quick to hop aboard the digital payments wagon, with the market being saturated with various e-wallet providers.
And the 2 most popular wallets in Malaysia are:
Touch ‘n Go
Introduced in 1997, Touch n' Go first began life as a smart card used by Malaysian highway operators to facilitate the payment of tolls. Touch ‘n Go has since expanded its range of services, with e-wallets being introduced in 2017.
The wallet's easy-to-use interface and quick setup have made it popular with customers and businesses. Users can either scan a QR code provided by the merchant or display their barcode for the cashier to scan.
Touch 'n Go has also begun offering investment products in GO+, which allows users to earn interest on their deposits.
Another familiar face on this list, Grab's GrabPay e-wallet, is another contender for the top spot in Malaysia. Like Touch' n' Go, GrabPay allows users to make payments by either presenting a barcode or scanning a QR code.
GrabPay's points system, which rewards users with discounts, has proven to be exceptionally popular with cost-conscious Malaysians.
Boost is owned by the fintech division of the Malaysian telecommunications giant Axiata (formerly known as Celcom). Marketed as the lifestyle wallet of choice for Malaysians, Boost offers a number of interesting features.
For example, the Boost app allows users to pay for various utility bills i.e. water, electricity, and telephone while they earn cashback points. Additionally, the platform also offers microinsurance plans via Boost Protect.
3. HONG KONG
When it comes to cashless payments, there's no doubt that Hong Kong has taken to digital wallets like a duck to water. According to the South China Morning Post, e-wallet payments are set to overtake credit cards by the time 2025 rolls around.
Hence, it should come as no surprise to see how crowded the Hong Kong’s e-wallet scene is, but here are our top contenders:
Given the island's proximity to China, it's no surprise that Alipay is the most popular e-wallet in Hong Kong. From paying bills to e-commerce shopping and even transferring funds, Hong Kong-ers love Alipay.
As an added plus, Alipay is available in English and Chinese - making it suitable for both foreigners and locals.
Coming in second place is the PayMe digital wallet from HSBC. Built with convenience in mind, this e-wallet let’s users quickly perform transactions by scanning QR codes via the PayMe app. It also allows users to use the recipient’s mobile phone number to transfer funds for peer-to-peer transfers.
Owned and managed by China’s most popular messaging app - WeChat, the aptly named WeChat Pay first surfaced in 2016. Since then, WeChat Pay has since exceeded Alipay in terms of popularity with more than 800 million users.
Furthermore, the introduction of WeChat’s red packet feature has served to further expand WeChat Pay’s popularity.
Thailand or The Land of Smiles is known for its highly competitive economy, and the e-wallet sector is no different. But from what we've seen, two names keep coming up whenever we talk about digital wallets.
And these are:
Founded in 2003, TrueMoney first began life as a telecommunications-focused wallet owned by the Thai communications giant - True Corporation. Since then, TrueMoney has moved from strength to strength and transformed itself into the dominant e-wallet in Thailand.
Leveraging the popularity of the LINE messaging app and partnering with Thailand's Rabbit Card has allowed Rabbit LINE Pay to compete with TrueMoney.
With Rabbit LINE Pay, customers can pay for highway tolls, transfer funds to friends and family, and perform a variety of offline and online transactions.
AirPay first appeared on the scene in 2014 as a means of facilitating purchases by Thai users on Garena. Initially, gamers were the primary users of Airpay but all of this has since changed.
The e-wallet platform now targets millennials and younger users in Thailand - a country where debit cards do not always work for online purchases.
5. THE PHILIPPINES
Like most countries worldwide, the Philippines was hit hard by the COVID pandemic and various restrictions. And because of this, the Philippines's mobile payments sector has experienced sustained growth year on year.
GCash is the product of a joint venture between Filipino fintech Mynt and Alibaba's Ant. With it, users can perform a variety of transactions with thousands of partner merchants.
And to encourage further adoption, GCash allows users to pay for reloads with cash at specialized machines or selected retail outlets.
Next on our list, we have PayMaya - a homegrown e-wallet that allows Filipinos to make various cashless payments. From bills to retail outlets and even remittances, PayMaya makes everything possible.
Like GCash, PayMaya allows its users to top-up their wallets at banks or self-service kiosks. Given the Philippines' low rate of digitalization, this has the potential to be a real game-changer.
Compared to other e-wallets, Coin PH may quite likely be one of the most interesting options on this list. That’s because Coin PH does not require users to own a credit/debit card or bank account.
Instead, they have the option to reload their wallets via Western Union, InstaPay or Palawan Pawnshop.
Additionally, Coin PH let’s users purchase cryptocurrencies of all kinds which include but are not limited to Bitcoin, Ethereum, and XRP.
To summarize, here are the top e-wallets in Singapore, Hong Kong, Malaysia, Thailand, and The Philippines.
And given the popularity of e-wallet in this region, businesses should definitely not overlook the potential of such platforms.