Treasury Today Asia January/February 2015

Published: Jan 2015



Mobilising the APAC markets

The ascent of mobile is arguably the greatest innovation that the payments industry has seen in recent memory. Nowhere does the mobile revolution hold more promise than in Asia. After all, the region accounts for over half of the world’s mobile devices. There is also a significant move towards m-commerce in APAC, with over 50% of all Asia-based online transactions in 2015 set to be made by mobile, according to Criteo.

Yet, as we frequently see in the region, there is great disparity between individual nations. This is not only as a result of varying levels of smartphone penetration, but also because of payment infrastructure challenges in rapidly growing markets, as well as certain cultural barriers.

Japan and South Korea are widely recognised as advanced markets for mobile shopping with Criteo reporting that over 45% of online retail transactions are made via mobile devices. In fact, Japanese e-commerce sites have mobile conversion rates that double those seen in the US. Australia is another mobile leader in the region, with impressive uptake of contactless payments.

Meanwhile, countries such as Singapore, Hong Kong and China – although possessing an infrastructure that is more than capable of supporting mobile payments – have yet to encourage widespread adoption. Others, such as Malaysia, remain largely cash-based societies.

While governments, national payments associations and internet providers are working furiously to increase mobile adoption, more must be done by banks and treasurers too. According to EY’s recent global commercial banking survey, almost 70% of banks’ commercial customers in Asia are using mobile banking channels each week. But when asked about the reasons for not using online and mobile channels more often, the most commonly cited obstacle in the region was security. This was closely followed by slow speed and poor functionality. In short, banks have some work to do in 2015 and beyond to provide security enhancements around their mobile solutions, as well as improved user experience.

Treasurers, on the other hand, should take the time to consider how mobile might provide growth and efficiency opportunities for their business. Mobile is not just for banking on the go, or a smart solution for merchants to improve consumer interaction. It can ultimately assist in improving your working capital metrics, whilst presenting many opportunities for cost-cutting too. So, in an ever-competitive market, mobile is surely worth a second look.

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