Market Trends of Singapore Payments Industry
The payments market in Singapore is driven by boom in the e-commerce industry
- According to the International Trade Administration (ITA), the Singapore e-commerce market was valued at USD 5.9 billion in 2021 and is expected to rise to USD 10 billion by 2026. The region has over 3 million e-commerce users. With a per capita income being USD 65,000, Singapore is also one of the most affluent countries in Asia.
- The increase in Internet penetration is one main factor driving the e-commerce market. For instance, as per ITA, the country has an internet penetration rate of 98% and a smartphone penetration rate of 93%, along with a 58% rate of residents making online purchases.
- Furthermore, the country is focusing on various collaborations with international players to develop 6G. For instance, in July 2021, The University of Oulu's 6G Flagship, the world's first and foremost 6G research, development, and innovation initiative, and Singapore agreed to collaborate on 6G technology. The alliance will concentrate on 6G technology research and development. 6G will enable greater speed, lower latency, and greater capacity for data networks.
- Because of the COVID-19 pandemic, many consumers continued to work from home and preferred to shop online rather than in stores. This paved the way for significant growth in e-commerce sales and businesses worldwide.
- Singapore's payments business is seeing a surge of innovative digital payment alternatives. It has emerged as the newest number-one trend for online payments in Singapore, owing to the increasing use of smartphones and the advent of digital wallet payment options such as PayPal and Buy Now Pay Later services.
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Retail industry shows the significant growth in Payments Market of Singapore
- The retail industry is one of the fastest-growing industries in Singapore. As a result, the retail sector represents a wealth of opportunities for new business, trading, and investing. The payment market in Singapore is developing with the changing customer behavior. Trends such as mobile payments, internet banking, instant payments, and the Government's growth initiatives are affecting the payment market in the country.
- Moreover, retailing plays a pivotal role in making Singapore a viable place to travel and reside. The sector also continues to recover strongly from the impacts of the pandemic, with the Department of Statistics (DoS) of Singapore announcing that the country's retail sales grew by 6.2% year on year in November 2022.
- Furthermore, This steady growth in the retail sector presents many opportunities for payment providers in the region to improve their payment platforms and apps to meet the growing demand. In addition, the increasing use of digital wallets and contactless card payments in the region presents a lucrative potential for payment providers.
- Also, starting in April 2022, retailers in Singapore were able to accept digital payment tokens (DPT) through a new crypto payment solution introduced by Singapore-based major payment institution FOMO Pay. The new payment method targeted at retailers was claimed to be the first such to be developed by a DPT licensee in Singapore. FOMO Pay started implementing its new solution with luxury retailers – such as EuroSports Global, 2ToneVintage, and Luxehouze, amongst others – in compliance with regulations.
- In Singapore, new services are being launched to meet the increased demand for internet delivery, with local cab company ComfortDelgro establishing a food delivery service and Google enabling the finding of food pick-up and delivery choices throughout the city-state. As residents hide down at home and follow the country's safe-distance regulations to manage the COVID-19 epidemic, there has been a huge increase in retail and meal delivery services.
