An image of a smartphone. Htet Tayza investigates smartphone payments

The rapidly-changing technological landscape is facilitating the rise of a global digital payments industry, promoting convenience to consumers. New data indicates that this convenience has made millennial consumers in the Asia Pacific (APAC) extremely receptive to digital payment services.

Global leader

Digital payment technologies allow consumers to pay bills and complete transactions via portable devices, primarily smartphones, to manage their finances anytime, anywhere. This makes digital payment services especially attractive in APAC countries, as these nations feature high volumes of unbanked citizens. In Myanmar, for example, 95% of citizens do not have a bank account, providing a gap in the market for financial technology (fintech) firms to supply digital payment services.

Coupled with a one billion-strong population and the emergence of digital payment apps, this has made APAC a global leader in mobile payments. According to a recent study, 53% of connected APAC consumers have used smartphones to pay for products and services, leading Europe (35%) and North America (33%). Also many APAC nations e.g. Singapore, are pushing to develop cashless societies, so the value of the region’s mobile payments sector is projected to hit just over US$270bn by 2021.

Payment practises

A new study from data analytics firm FICO shed light on this fast-expanding industry. According to MIS Asia, a regional technology portal, FICO found that mobile technologies and automated collection facilities are allowing APAC customers to make more timely payments. In the past year, 60% of bank senior collections managers polled said that APAC consumers have taken longer to settle their bills.

Just over two fifths (41%) of respondents admitted that during this time frame, the “60-days past-due date segment,” has seen the highest expansion rate. However, FICO’s study suggested that consumers were more likely to settle their bills on time when their payments were automated, or they were sent reminders to their smartphone. This trend applied particularly to APAC millennials aged 25 to 34.

Key benefits

According to FICO, 59% of those questioned said that these facilities allowed customers to pay their bills between one and two days faster. Meanwhile, 25% revealed that thanks to digital technologies, they were able to collect payments in between three days and two weeks. Also, 78% argued that automated communications have increased consumer satisfaction rates, which is key to retention.

Commenting Dan McConaghy, the President of FICO’s APAC division, said: “It is encouraging to see that millennials in APAC are more responsive and willing to take speedy action on bills when approached using their preferred communication channels. Given that 60% of the world’s millennials will be living in Asia by 2020, it’s important that business adapt to their expectation of digital service channels that are easy to use.”

Facing challenges

It is clear, therefore, that digital payment technologies are already proving highly useful for APAC-based financial services firms. Not only are they promoting financial inclusion for previously-unbanked citizens, broadening the customer base for financial firms, but they are facilitating the convenience customers need to pay bills on time, so companies do not have to waste resources chasing payments.

It is unsurprising that digital payment technologies are popular among millennials, as these consumers grew up in an online world. But financial firms may find it hard to recruit older consumers in APAC countries like Myanmar. Within these territories, people traditionally distrust financial institutions and therefore, may not prove as receptive to innovative digital financial solutions as millennials.

APAC’s fintech providers would be advised to focus on improving security, as financial institutions are a favourite target of cyber-criminals. For instance, data gathered by ACI Worldwide, a payment systems firm, shows that mobile usage is fuelling card fraud in the Association of South-East Asian Nations. By bolstering digital payment security, fintechs will gain the ability to handle consumer capital more safely. This could foment the trust needed to increase participation in the digital payment sector among all APAC consumers, creating new opportunities for firms across the region.

Htet Tayza.


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About Htet Tay Za

My name is Htet Tay Za and I’m a young banking professional from Myanmar. I was born in Yangon, Myanmar twenty-four years ago. I have a keen interest in business, cuisine, lifestyle and philanthropy.


Asia Pacific, fintech, Htet Tayza, htoo htet tayza


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