With payment solutions such as mobile and digital wallets displacing traditional payment methods like cash and bank transfers, alternative payments have become the most popular payment tools for e-commerce payments in Asia-Pacific (APAC), stated a report by GlobalData. In the region, China led the way in 2023 with alternative payments accounting for nearly two-thirds of the total e-commerce payments value in 2023.
With popularity in countries like China and India, alternative payments are gaining traction in other APAC markets as well. GlobalData’s E-Commerce Analytics revealed that even cash-intensive countries in the region such as the Philippines, Malaysia, and Indonesia, are witnessing a similar trend.
Shivani Gupta, Senior Banking and Payments Analyst at GlobalData, said, “While most Asian markets are traditionally cash-dominated, the adoption of alternative payment methods for both online and in-store payments is growing across many markets in the region, outpacing the West. This trend is driven by the rising smartphone and internet accessibility, increasing convenience of electronic payments, and the proliferation of mobile and QR code-based payment solutions.”
Within the region, China and India have higher adoption rates compared to their peers. According to GlobalData’s 2023 Financial Services Consumer Survey, alternative payment solutions account for more than 65 per cent of the e-commerce transaction value in China. This represents a significant increase from 53.4 per cent in 2018. With mobile wallets like Alipay and WeChat Pay now being widely used in China for day-to-day transactions, China is leading in the market.
On the other hand, India has seen the fastest jump in alternative payment share in the region, from 20.4 per cent in 2018 to 58.1 per cent in 2023, and thereby reaching the second place. This significant uptake of alternative payment solutions can be attributed to the widespread usage of mobile wallets, largely driven by UPI, which facilitates mobile payments in real-time simply by scanning QR codes.
Other Asian markets like Indonesia, Hong Kong, Singapore, and the Philippines are also seeing high adoption of alternative payment solutions.
Shivani Gupta added, “Alternative payment solutions account for lion share in e-commerce markets across many APAC countries, supported by rising internet and smartphone penetration, and growing acceptance of digital payments by merchants. With the convenience, speed, and security they offer, coupled with high expected growth in the overall e-commerce market in the region, these payment tools are anticipated to further gain traction and disrupt the consumer payment space in the region.”