Singapore Government Aiming to Make the City-State a Cashless Society By 2025
The days of paying with cash are slowly fading into the sunset. Singapore, one of the most influential economic powerhouses in Asia, is moving to a cashless society. According to Ong Ye Kung, the Education minister of Singapore, who is also a board member of the Monetary Authority of Singapore, the Singaporean government is aiming to eliminate the usage of cheques and reduce cash payments in the country. The authorities have been doing their best to make Singapore a cheque-free country by 2025.
How Moving Away from Cash is Brewing in Singapore
Growing by more than $10 billion a year, e-payment in Singapore has gained its traction as one of the secured payment methods. According to Ong, more than eight in 10 Singapore consumers have adopted e-payments. Similarly, almost three in five Singapore merchants are accepting e-payments. All of these signs are good omens of realizing the goal of making Singapore a cashless society.
Singapore government has been aiming to go deeper into the realm of cashless payments. Well, the government has been mapping out various strategies to reach this goal. The latest cashless strategy is instantaneous online payments without having to disclose banking details. The strategy is made possible when PayNow transfer service includes businesses.
Launched last year, PayNow allows users to perform online transactions via their mobile phones without disclosing their banking details. PayNow has garnered around 1.4 million registrations where the transaction volume recorded at nearly $900 million. PayNow is particularly useful for one-off payments (e.g. insurance claims and casual labor wages). One of the best things about it is that now remitters do not need to keep track of payee details. This is because every data is at a central repository managed by a third party.
Featuring seven participating banks: Citibank, DBS, HSBC, Maybank, OCBC Bank, Standard Chartered Bank and UOB, PayNow Corporate has brought e-payment in Singapore to a new height. Following the success of the Ministry of Education Edusave Awards’ disbursements via PayNow, other government agencies are exploring ways to perform disbursements via the platform.
Singapore Leads the Race to Become Cheque-Free and Cashless
“Cash is no longer king” – perhaps this is currently the best sentence to describe the brewing cashless environment in Singapore. ATM withdrawals have declined by more than $300 million a year; fell by 40% if compared with the previous year. The declined ATM withdrawal figures have provided an insight into the wider shift towards a cashless society. It shows that consumers are shying away from bricks-and-mortar bank branches.
Following the rising adoption of e-payments by Singaporeans in line with the Government’s cashless economy policy, the cheque transaction volume has hit a low figure by 28% last year; fell from 37% in 2015. The declined cheque transaction volume is another good sign that Singapore is on the right track to becoming a cheque-free country by 2025.
While electronic payments are getting popular due to the convenience and hassle-free user experience it affords the user, e-payment systems are prone to the risk of fraud. According to Ong, a new Payment Services Bill will be introduced later this year in relation to enhancing consumer protection against e-payment risks.
