Mobile wallet is gaining popularity all over the world, as it allows consumers to make cashless purchase straight from their mobile. In the latest ‘GroupM Mobile Wallet’ Study, WeChat Pay leads the mobile payment growth in Hongkong with a user base of 52%. Its user base grew more than 2.5 times as compared to 1 year ago from about 19% user base in 2017, overtaking major competitors like Apple Pay, Alipay, Samsung Pay and more.
This comes after Tecent’s expansion of its cashless payment system earlier this year, as it allows Hong Kong residents to be able to use its WeChat Pay wallet without a Chinese Bank Account or credit card and the expansion of Ringgit WeChat Pay wallet for Malaysian.
As Chinese mainland visitors accounted for 72% of overnight visitor spending in Hong Kong in 2017, doling at US $16.5 billion, merchants are pressured to accept the mobile payment modes. Major players like Hong Kong’s Tap & Go, Chinese’s AliPay and WeChat Pay are aggressively stepping up effort in attracting more merchants, competing for the usage rate by consumers. This had allowed Hong Kong’s active mobile wallet usage to increase by 30% to 89% of the whole population. There is an major increasing trend of usage frequency, with average monthly spending at US$600, up from US$105 a year ago, with more type of services being paid by mobile payment.
Like Singapore, Hong Kong is embracing advanced technology to enhance its status as a regional financial hub and complete with other major cities. It had lagged behind mainland China in the adoption of advance mobile payment method.
Although Hong Kong is one of the first country to introduce cashless payment system with its Octopus card, it had failed to innovate further, as its Octopus card is heavily rely upon. This have also caused a slow implementation rate of mobile payment options, as Octopus card had already been a part of Hong Kongese lifestyle, which takes time to change.
Hong Kong’s government is also pushing for a smart city, with initiatives to go cashless, similar to Singapore’s Smart Nation project. Some of the initiatives for a smart nation includes going cashless and adaptation of artificial intelligent (AI). However, Singapore is in the significantly more advance as it ranks 2nd as compared to Hong Kong at the 68th spot in the 2017 Smart City Index.