Southeast Asia is Integrating Fragmented Digital Payment Market
Southeast Asia has become a focus area for all parties in the digital payment industry. However, the market is quite fragmented, with competition and collaboration amongst e-wallet-based mobile payment operators, acquirers, and traditional card-based issuers, as well as settlement networks.
Source: PayNow-PromptPay linkage
In addition to the traditional international card networks adhere to their own global unified standards after entering the QR code payment field, other types of wallet payment tools like PayLah!, Dash, and Shopeepay use their own set of payment standards and build their own acceptance networks. The fragmentation of the payment market has inevitably occurred.
On the other hand, massive market fragmentation in the region lengthens and complicates the process. Thus, SE Asia’s fragmented digital payments market is showing a sign of integration.
Monetary Authority of Singapore (MAS) promoted the unified terminal (UPOS), which has greatly optimized the multi-terminal situation on the merchant side and simplified the difficulty that cashiers have to endure with the identification of different payment tools.
Source: ShopeePay
Furthermore, Singapore and Thailand this year launched the linkage of their respective national real-time retail payment systems — PayNow in Singapore and PromptPay in Thailand, according to Monetary Authority of Singapore (MAS). The PayNow-PromptPay linkage shows that existing payments infrastructure and the banking system have the potential to provide seamless cross-border payment and integrated options to retail customers
In the long run, what form the fragmented payment scenario will achieve integration is a question worth discussing. The scenario may be likely to occur, where larger merchants only choose payment tools with market scale. Smaller-scale payment tools that lack sufficient high-quality merchants and use cases will be integrated with other payment tools or industry partners.
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