Today, peoples’ daily lives are going digital. Their purchasing mode of behavior has progressed from physical to online stores combined with their mode of payment becoming seamless with in-app experience of electronic payment (E-payment) whether they are cash moving to cards or QR codes at the point of sale (POS) that the E-payment had great social impacts. And according to Slozko and Pelo (2015), “Information and Communication Technology (ICT) and Digital technologies had made great evolutionary development in finance, economics, operational costs” and enhanced organizational performance.
E-payment is in a revolutionary stage of the global economic industry. The increasing speed of E-payment adoption is driven by multiple factors. According to Mishra (2020), Generation Z (individuals born between 1990s to early 2010s), easy payment methods, open banking ecosystem, rewards incentive and Network, are the factors for a rising adoption of electronic payment (E-payment). Besides, the onset of COVID-19 in 2020 had created a reset in the payments ecosystem across the globe (Reet Chaudhuri, Jacob Dahl, Bharath Sattanathan, & Sengupta, 2020), as most people are forced to stay at home for a longer duration and encouragement of cashless payment also promotes the development of E-payment.
E-Payment Development in Different Countries
According to Capgemini., (2017), as cited in Key Trends in Digital Payments Markets and Strategic Infrastructure 2018), the global electronic payment (E-payment) volumes are rising at almost 11% per year. The key trends currently shaping digital payments markets are real-time payments, regulatory interventions and Open Banking (Key Trends in Digital Payments Markets and Strategic Infrastructure 2018). In the EuroZone of Sweden, Finland and Norway, makeover 450 E-payments per person per year, and in the UK and the US, the E-payments per person per year are around 300 and 400 (Key Trends in Digital Payments Markets and Strategic Infrastructure 2018).
Commercial transactions continue to shift from cash transactions to e-transactions (Al-Laham, Al-Tarawneh, & Abdallat, 2009). E-commerce’s new wave of growth is linked to the expansion of mobile broadband, the popularisation of smartphones, reduced costs for data usage, and rich online shopping and payment tools on portable devices and platforms. Almost 80% of Internet users in China and two-thirds of those in ASEAN use smartphones to access the Internet. The use of mobile phones is very widespread in emerging Asia with Thailand, Malaysia, Indonesia and Cambodia all enjoying similar levels of mobile phone usage as in high-income Singapore.
Payment systems – either online or offline – are vital components of e-commerce. Various solutions are available, including cash on delivery (CoD), prepaid, credit cards, debit cards, e-banking, mobile payment, smartcard and e-wallets, among others (Premchand & Choudhry, 2015). Where available, a variety of options promotes e-commerce growth because it allows consumers to choose their preferred ways to pay for online business.
Ideally, e-commerce development would be fostered by the building of a payment system that can accommodate existing market solutions and remain open to new approaches in the future. Rather than simply a payment network, the e-commerce payment system should also be part of a service platform that can ensure transition security, trace credit records and offer consumer protection. Security, privacy, creditability, reliability and efficiency are among the main factors to be considered. Building and maintaining the e-commerce payment system requires resources in terms of capital, technology and people. This will be a big challenge for those Asian countries whose domestic banking and financial systems are still at an early stage of development.