COVID-19 Has Shifted Singapore To Digital Payment Methods

The COVID-19 pandemic has accelerated Singapore's push to digital payments, with a rise in card payments and decline in cash usage.

GlobalData, a leading data and analytics company has estimated that total card transactions (POS and ATM) in Singapore to grow marginally by 0.4 percent in 2020, compared to 7.8 percent growth in 2019. While card payments (POS) are forecasted to grow by 2.5 percent in 2020 to reach S$114.7bn (US$85.3bn), cash withdrawals at ATM is forecasted to decline by 3.4 percent during the same period.

“Singapore is a highly developed contactless card market, with most consumers having access to a contactless card,” commented Ravi Sharma, Lead Banking and Payments Analyst at GlobalData.

“The COVID-19 outbreak has spurred merchants to adopt electronic payments. Cash payments are set to decline in the short-term in Singapore while card payments, particularly contactless payments, are expected to grow.”

Backing from big banks and large merchants has made contactless a mainstream payment method in Singapore, as contactless cards are accepted by most retailers. The current pandemic is expected to further push the adoption and usage of contactless cards in the country.

“The COVID-19 pandemic and subsequent lockdown restrictions in Singapore have affected consumer spending, resulting in the decline of payment transactions. With government gradually easing lockdown restrictions, rise in consumer spending is being witnessed,” concluded Sharma.

“This, coupled with rise in contactless adoption, is expected to support card payment growth.”