Security fears slow Hong Kong’s AI adoption

Despite rising digital wallet use, Hong Kong consumers remain hesitant toward AI-driven retail.

Hong Kong’s shift toward cashless commerce is accelerating, with digital wallets now accounting for 23% of all retail payments. Yet the city’s adoption of AI-enabled shopping tools remains far slower, held back by concerns over security, data privacy, and trust. Industry leaders say these fears—not technology limitations—are the biggest obstacles to unlocking the next phase of retail innovation.

Kai Tang, Head of Hong Kong at Adyen, said that while AI adoption has surged globally, Hong Kong consumers remain cautious. “In Hong Kong, our research shows that actually 60% of consumers haven't actually tried AI shopping,” he said. “What we see is that hesitation could really be boiled down to sort of the lack of familiarity and trust.”

Security remains the defining issue. Citing the company’s 2025 AI Index, he added that “online security and safety and data privacy are the key concerns for many consumers nowadays, about 30% actually worry about fraud, and actually a higher number than 35% are still concerned about the reliability of AI generated suggestions.”

Even as consumer caution persists, demand for AI is rising among younger shoppers across the region. Anson Bailey, Head of Consumer & Retail, Asia Pacific at KPMG China, said Gen Z buyers are shaping the pace of adoption. “They are incredibly tech savvy. They're the ones that are really driving that tech adoption,” he said. These consumers embrace AI for convenience, efficiency, and its ability to deliver competitive pricing.

To build trust, Bailey stressed that retailers must focus on internal readiness. “We have got to ensure that people get comfortable with the use of AI,” he said. “Make sure that you are upskilling and reskilling your own teams.” He added that rather than replacing humans, “the reality is that humans are going to get replaced by other humans with those AI skill sets.”

Tang said retailers should start with lower-risk, high-value use cases, pointing to personalisation as an entry point. He also emphasised transparency and autonomy: “Allow customers to opt in for AI experiences so they feel they're actually in control of their overall experience.”

Both leaders agree AI will become a major differentiator, with Tang noting that 40% of Hong Kong retailers are already investing in AI for fraud detection, marketing, and operational efficiency.