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Singapore’s Real-Time Payments Transactions Surge by 48 Percent in 2020 as COVID-19 Pandemic Accelerates Shift to Digital Payments – New ACI Worldwide Research Reveals

April 7, 2021 Financial No Comments Email Email

More than 138 million real-time payments transactions were processed in Singapore in 2020, a surge of 48 percent compared to the previous year (93 million), as the COVID-19 pandemic dramatically accelerated trends away from cash towards greater reliance on real-time and digital payments, a new global report from ACI Worldwide (NASDAQ: ACIW) and GlobalData reveals.

The second installment of ‘Prime-Time for Real-Time,’ first launched in 2020, analyzes global real-time, account-to-account payment volumes and forecasts across 48 global markets. It projects a Compound Annual Growth Rate (CAGR) for real-time payments of 23.21 percent in Singapore from 2020 to 2025.

With two established real-time payment schemes in place, a wide range of authorization methods and 48% YOY growth, Singapore is well on its way to becoming an established market for real-time payments. Fast and Secure Transfers (FAST) was the first scheme, launched in 2014. FAST enables retail and corporate customers of participating banks to transfer funds 24/7/365. Singapore’s second scheme, PayNow, launched in 2017. It is a P2P instant fund transfer service built on the FAST infrastructure and allows users to transfer funds from one bank account to another using a mobile number or national ID card number.

With millions of people globally having to change the way they work and live – and the way they shop and pay – new technologies are growing rapidly. Mobile wallet adoption rose to an historic high in Singapore of 70.9 percent in 2020, up from 56.9 percent in 2019 and 27.5 percent in 2018.

As the pandemic continues to drive changes in consumer and business behaviors, banks, merchants and intermediaries across the payment ecosystem in Singapore are responding rapidly, prioritizing the shift to digital to protect current revenue streams, and searching for new ones through a fully digitized customer experience.

“The pandemic has cast the spotlight on the importance of digital payments and robust payment infrastructures, condensing a decade of anticipated innovation into one year and creating human behavioral changes that will not reverse as we emerge from the crisis,” commented Jeremy Wilmot, chief product officer, ACI Worldwide. “Countries with a robust digital payments infrastructure already in place have coped better than those without when it comes to containing the economic impact of the pandemic. Real-time payments have enabled governments, working jointly with financial institutions, to accelerate much-needed disbursements and economic stimulus payments to their citizens. They have also enabled real-time liquidity to businesses that had to adapt to disrupted supply chains.”

“Real-time payments are still in a nascent stage worldwide, and mostly focused on the obvious use-case of P2P payments in many countries,” said Samuel Murrant, Lead Analyst, Payments, GlobalData. “However, the pandemic has provided an opportunity to accelerate the growth path for these instruments. As consumers become used to the speed of real-time settlement for P2P payments, they will naturally move to using them for e-commerce over the relatively slower and less convenient process of using cards online. From there, there is potential to move into in-store payments, once enough consumers recognize real-time payment brands and the user base is high enough to deliver sufficient value to merchants.”

Summary of Key Findings: 

Singapore real-time payments growth:

  • Total number of real-time transactions in 2020 was 138.38 million, up 48 percent from 93.24 million in 2019. It is predicted to grow to 392.94 million by 2025
  • The real-time share of electronic transactions in Singapore in 2020 was 9.3 percent, up from 6.6 percent in 2019; it is predicted to be 17.1 percent by 2025
  • The value of real-time transactions was up by 40 percent from 2019 rising from $110bn to $154bn; the expected CAGR by 2025 is 17.74 percent
  • Mobile wallet adoption rose to an historic high in Singapore of 70.9 percent in 2020, up from 56.9 percent in 2019 and 27.5 percent in 2018.

Global real-time payments growth:

  • Total number of real-time transactions in 2020 were 70.3 bn, up 41 percent from 50.0 bn in 2019
  • The real-time share of global electronic transactions in 2020 was 9.8 percent, up from 7.6 percent in 2019; it is predicted to be 17.4 percent by 2025
  • The value of real-time transactions was up by 32.8 percent from 2019 rising from $69tn to $92tn; the expected CAGR by 2025 is 12 percent

Top 10 countries globally by number of real-time transactions in 2020:

  • India retains the top spot with 25.5bn real-time payments transactions, followed by China with 15.7bn transactions; South Korea is in 3rd place with 6.0bn, Thailand 4th with 5.2bn and UK is in 5th place with 2.8bn
  • Nigeria follows up in 6th place with 1.9bn transactions, Japan in 7th with 1.7bn
  • Brazil climbs into the global top 10 as number 8 due to the launch of PIX, with 1.3bn transactions driving a 58 percent YoY increase from 2019 to 2020. Expect to see the country climbing even higher next year with a 5-year growth prediction of 25.3 percent CAGR
  • The US ranks number 9 with 1.2bn transactions and Mexico ranks 10 with 942mn

Fastest growing countries for real-time payments:

  • The top spot goes to Croatia with an expected CAGR of 374.4 percent between 2020 and 2025, followed by Colombia (112.7 percent), Malaysia (83.9 percent), Peru (74.4 percent) and Finland (71.4 percent)
  • The highest growth region (CAGR 2020-2025) is predicted to be North America (36.5 percent), as both Canada and the US modernize and drive their new real-time systems (RTR and FedNow)

Global mobile wallet adoption:

  • Mobile wallet adoption rose to an historic high of 46 percent in 2020, up from 40.6 percent in 2019 and 18.9 percent in 2018
  • Total mobile wallet transactions amounted to 102.7 bn in 2020 and are expected to reach 2,582.8 bn by 2025

Payments fraud:

  • Globally, card related fraud remains highest in terms of reported incidents from consumers, but fraud incidents associated with real-time payments were on the rise from 2019 to 2020 as fraudsters tend to target new channels
  • Real-time payments scams that were on the rise include: confidence tricks (12.5 percent rising to 13.7 percent), Identity theft (6 percent rising to 11.6 percent) and digital wallet account hacks (4.4 percent rising to 6.2 percent)

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