![]() ![]() Mr Lim Jialiang, who owns an online chocolate shop and has a stake in a physical food and beverage outlet, said: “While there are unique circumstances for each country, I strongly think that there is a strong correlation between transaction fees and adoption of cashless payments.” Merchants in Singapore pointed to these high transaction fees slowing the take-up of cashless payments. Even so, the fees for credit card transactions in China, in a range of about 0.35 to 2.5 per cent, are also often below those for Singapore, where they are between 2 and 3 per cent. Pointing to China’s “fairly low” credit card penetration rates, Mr Yeo said: “Mobile payments with their lower merchant rates as well as lighter infrastructure totally jumped ahead of card payments.”įees for popular digital payment apps in China such as AliPay or WeChat Pay - which are linked to bank accounts - are at 1 per cent or less, often lower than those for credit card transactions. This is in stark contrast to many cities in China, which has gone one step further, leapfrogging card payments to become the world leader in mobile payments. “Reasons for this include the high merchant fees for cards -cutting into profits - the costs of setting up the POS (point-of-sale) system and maintaining it … The lack of acceptance of cards everywhere in turn means that consumers generally need to carry some amount of cash with them at all times for day-to-day purchases,” he said. Mr Michael Yeo, research manager at IDC Financial Insights, noted that small businesses, especially those in the heartlands, are still reluctant to adopt cashless payments. The combined ATM network of all three local banks - DBS, UOB and OCBC - numbers more than 2,300 across the island, making even regular withdrawals of small amounts convenient for most consumers. In other countries, the risk of cash and the cost of insurance for cash in premises translates to a real cost of holding cash.” Ironically, the low crime rate in Singapore means that both users and merchants have no fear of carrying too much cash. Mr Chia Tek Yew, head of Financial Services Advisory at KPMG, said: “For the customers, cash is easily accessible and acceptable at all outlets. The payment apps can lag or take time to process too,” she added. Also, I don’t feel like I need to use credit cards for tiny amounts,” said business executive Hannah Chua, 35, who withdraws up to S$1,000 in cash from an ATM each time. “Some places, like kopitiams, still do not accept cashless payments. SINGAPORE - High credit card fees and the convenience of cash, including easy access to numerous automated teller machines (ATMs) islandwide, are hampering the adoption of cashless payments in Singapore, consumers and industry experts told TODAY. ![]()
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