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Checkout.com Report Reveals Rapid Singapore Adoption of Digital Commerce Driving “Ecommerce Bull Run”

The Asia Pacific (APAC) region has experienced an ‘ecommerce bull run’ since the onset of the global pandemic, according to a new study from the leading cloud-based global payments solutions provider, Checkout.com. The report reveals more than nine out of ten (95%) consumers in APAC have shopped online or in-app more than twice in the last year, with 70% of online shoppers in Singapore shopping via a mobile app.

The findings form part of Checkout.com’s Payments Optimization in APAC report, a comprehensive look at how payments and ecommerce innovation is rapidly spreading across the region, revolutionizing how consumers shop and setting the standard for other geographies to follow.

Vladimira Artopé, Singapore Country Manager, Checkout.com said: “Despite the global shutdown resulting from the worldwide pandemic, our findings clearly illustrate the rapid acceleration of ecommerce and online payments in the region. As Singapore recovers and heads into the new normal, we have noticed that 60% of Singapore consumers have been shopping online more regularly than before the pandemic. This is the highest percentage of online shoppers as compared to markets in SEA, with Indonesia coming in at 55%. Cross-border ecommerce is contributing to this trend, as 40% of Singaporean consumers said that they shop online because they’re purchasing products that are not available in the country.”

While the report reveals that China is setting the global bar as a leader in payments from super-apps to embedded finance, as the China market matures, Singapore is also increasingly becoming a key center of innovation and adoption.

The research, conducted by Checkout.com in partnership with YouGov is the result of an in-depth study of more than 12,000 consumers across APAC, including China, Japan, Australia, New Zealand, Indonesia, Thailand, Singapore and Hong Kong.

Among the findings of the Payments Optimization in APAC report:

Localization is especially critical in Asia Pacific

While it’s common for payment rails, infrastructure, standards and regulations to vary per country, APAC in particular features significant regional and demographic differences. This highlights the need for merchants to have a hyper focus on localization when it comes to digital payments.

Singapore ranks the highest in preferring card payments at 69%. The country’s data also shows that 22% prefer using digital wallets, as compared to 31% in Indonesia and 39% in Thailand.

The report shows that global payments are an inevitably localized and complex matter. Understanding the nuances of how consumers shop varies greatly from country to country. Regardless of location or activity in the APAC region, merchants who ignore these local trends do so at their own peril.

Pandemic Online Shopping Showing No Signs of Slowing

When it comes to digital payments and ecommerce, the Asia Pacific region is without rival. Checkout.com’s study found 95% of consumers in Asia Pacific shop online, with 80% of them using some form of fintech app to manage their finances. In Singapore, 77% of respondents use fintech apps to manage remittances, investment and wealth, budgeting, banking, lending and personal finance.

Meanwhile, the majority (54%) of APAC consumers said that they are currently spending significantly more money online as a result of the pandemic, with 88% of respondents saying that they expect to sustain or increase this higher spend level post-pandemic. Around 48% are making purchases significantly more frequently and 40% expect a further uptick in their online spend during 2021 and beyond the pandemic recovery. Among those surveyed, 53% indicated that they regularly use an app to send or receive remittances. However, 33% say that a complicated payment process has permanently deterred them from returning to a site or app, demonstrating a need for merchants to remove friction from the payments process.

Cross-Border Commerce

Asia Pacific is a hotbed of cross-border activity in ecommerce, with 40% of respondents from Singapore spending online to purchase products not available in their own country.

Indonesia and Thailand also rely heavily on cross-border commerce. In fact, research by Accenture shows that over 40% of ecommerce in APAC is cross-border. Surprisingly, there are exceptions for areas that buck the trend: Around 14% of Hong Kong respondents say they never shop online – compared with the APAC average of 5%. By comparison, only 3% in Singapore say they never shop online.

For those that do shop online in Hong Kong, 88% say an important advantage of online is the fact that they can more easily identify discounts and savings, while only 50% agree that it saves them time. When it comes to cross-border commerce, however, Japan is one outlier, despite being the world’s 3rd largest ecommerce market. Checkout.com’s study reveals that 76% of Japanese consumers surveyed said they would not buy from a website that was not fully in Japanese throughout the shopping and paying experience.

Mobile apps and digital finance are empowering women in APAC

With the exception of Japan and Australia, in all countries surveyed, women were found to be the primary holders of the digital purse-strings, being significantly more likely to shop online weekly or daily than their male counterparts. Overall, more women than men list digital wallets as their most frequently used payment method. In Singapore, 28% of female respondents currently shop online once per week or more as compared to 22% male respondents.

Another notable example in the region, Indonesia and Thailand not only lead the way when it comes to fintech penetration and the use of digital wallets, but also stand out for the level of digital financial activity performed by women. For example, in Indonesia, where the use of remittances apps is broadly high, Checkout.com found that while 67% of unmarried men use fintech for money transfer, this compares with 78% of unmarried women, while 80% of the married population across both genders use a remittances app.

The Emergence of Buy Now Pay Later

When buy now, pay later – BNPL – took the world by storm during 2020, APAC was considered one of its hot-beds and the region is widely forecast to see the world’s fastest growth in BNPL adoption by 2027. BNPL allows consumers to buy a good or service now without having to pay for it until a later date. Checkout.com’s research indicates that the concept of BNPL is the key reason why consumers in the region are choosing to shop and pay online, particularly among those under the age of 30.

While 11% of respondents in Singapore mentioned that BNPL Optionality was the number one reason to shop online or in-app, there are nearly a third (29%) of 18–30-year-olds in Indonesia and more than a quarter (26%) in Thailand with the same thoughts. Additional research by Google and Bain shows that roughly 30% of BNPL transactions in 2020 were coming from new users.

Security and Safety a Competitive Differentiator at Checkout

When it comes to digital checkout, the security of the consumer’s data and money are the top concern across most of the APAC region. In Singapore, 73% of consumers say they believe that paying online via an app or website is a safe thing to do while 90% of consumers in Hong Kong say they have abandoned carts due to security concerns and 18% say they regularly do so.

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