Smaller e-payments players are finding it hard to gain traction against the ubiquitous card.
Smaller players in Hong Kong’s e-payments scene are finding it hard to gain significant market share and chip away at the dominance held by smart card Octopus which has over 34m stored-value cards in circulation - more than the city’s 7.41m population, according to BMI Research.
Octopus card is one of the world’s first payment cards launched by the government in 1997 initially for transport payments but has since expanded to usage in various small and medium businesses.
The smart card has is also riding on the mobile payments trend following a partnership with Samsung to launch Smart Octopus but the initial market response from key target groups has so far been lacklustre.
“Whilst Octopus has been gradually seeking to shift towards mobile payments, takeup has been slow and efforts to encourage adoption have faced difficulties,” BMI noted, adding that the smart card is facing difficulties in encouraging small merchants and taxi drivers to move away from the tap and go system and towards the QR code payment it is espousing.
Security and privacy concerns also hinder the wider adoption of e-payment systems in Hong Kong against a general preference for cash and credit cards.
Despite the roadblocks, mobile payments systems is set for a wider take up as the region has one of the most mature mobile markets and supportive regulatory frameworks in Asia but BMI noted that the process will likely be slow as the market remains resistant.
Photo from Wuxxx790 - Own work, CC BY-SA 4.0
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