This is expected to increase amidst efforts to push for electronic payment.
Nearly nine in 10 or 87.8% of Hong Kongers have been using mobile wallets to pay in the past 12 months, a recent study by GlobalData revealed.
According to the 2023 Financial Services Consumer Survey, the adoption was accelerated by the COVID-19 pandemic as health restrictions led to the shift from cash to electronic payments.
Ravi Sharma, lead banking and payments analyst at GlobalData, said mobile wallet usage is set to gradually displace cash in Hong Kong.
“Widespread QR code infrastructure, the availability of mobile-based instant payment systems, and rising consumer and merchant preference all contributed towards mobile wallet usage,” Sharma noted.
GlobalData said cash remains to be the preferred non-cash payment instrument, but the rise in the use of mobile payment is evident.
The drivers for this move are Hong Kong’s strong adult banked population and smartphone penetration, the availability of mobile wallets including domestic and international brands such as Octopus Wallet, AlipayHK, Apple Pay, and Google Pay, and the growing merchant acceptance.
GlobalData noted that AlipayHK is one of the most used mobile wallet brands with 3.3 million users and a merchant base of 150,000 as of May 2024.
The government has been also investing in building infrastructure for mobile wallet payments, such as the Hong Kong Common QR Code (HKQR). This was implemented by the Hong Kong Monetary Authority to eliminate the need for merchants to display multiple QR codes, thus encouraging the use of QR codes for payments.
Complementing this was the introduction of real-time (instant) Faster Payment System (FPS). This does not only allow real-time fund transfers between bank accounts but also supports QR-code-based merchant payments, GlobalData said.
As of May 2024, 36 banks and 10 payment service providers support FPS.
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“Mobile wallet has become a mainstream payment solution in Hong Kong, driven by the government push, supporting payment infrastructure, and the proliferation of mobile wallet brands,” Sharma said. “With smartphones being integral to everyday life in Hong Kong, and consumers becoming more comfortable utilising mobile phones for making payments, this space is likely to record further growth going forward.”
