Cards and Payments in Asia-Pacific

Published: January 2012
No. of Pages: 103

• This VRL report looks at the key drivers, historic performance and future prospects for cards and payments regionally
• Card trends are projected out to 2015
• The relationship between banks, telco providers (fixed and mobile) as well as banked and unbanked consumers are explored
• The regional imbalance caused by both China and India results in these countries being given specific prominence

The Asia-Pacific region is becoming more cashless, since card reading instruments have reached saturation point in some countries, including Australia and Singapore, and mobile payment implementations are being introduced across the region. The value of Asian non-cash transactions will have reached over $300 trillion by 2020, a significant uplift on the $91 trillion recorded in 2010. This represents an average annual growth rate of 1.3%. Although this annual growth rate appears low, it will still allow the Asia-Pacific region to capture the world’s largest amount of cashless transactions in 2020. Furthermore, the growth rate of non-cash transactions anticipated for developed regions is much lower. For example, the value of non-cash transactions is expected to reach a total of over $120 trillion in the US by 2020, after recording an average annual growth rate of 0.4%. In addition, the value of non-cash transactions in Europe is projected to reach over $200 trillion in 2020, after recording an average annual growth rate of 0.6%.

• Gain an overview of the Asia-Pacific cards and payments market, with detailed analysis of 14 countries in this region
• Gauge the opportunities in the most significant segments, including debit/credit cards, e-money and mobile payments
• Prepare for the future of cards and payments with insights into the potential development of the Asia-Pacific region
• Benchmark against case studies of financial and mobile companies from the Asia-Pacific cards and payments market

Reasons To Buy
• This report presents a detailed market overview as well as many country specific features
• Growth drivers vary considerably – this report identifies as many as possible
• This report details the differences between the more and less developed markets in the region
• China and India are prominently examined for their growth potential, as is Australia, perhaps the most mature payment card market in the region

Key Highlights
• The Asian mobile payments market will be the largest in the world by 2015
• Prepaid cards payments are expanding at a faster rate than mobile payments throughout Asia
• Changes to the regional middle classes are important in assuring high mobile payment take up rates, while the large numbers of the ‘unbanked’ are the drivers for prepaid cards
• Mobile payments will be driving a large part of the regional growth for both telecom companies and mobile operators

Cards and Payments in Asia-Pacific

Table of Contents
Executive Summary
1 Overview of the Asia-Pacific Payment System
1.1 The Asia-Pacific payment system is recording a strong growth in debit cards
1.2 Changing long-standing cash-related habits is still difficult in some countries
1.3 The future of the Asia-Pacific payment methods is more and more cashless
1.4 EMV contributed to the growth of the Asian card payment methods by increasing the security of transactions
1.5 The infrastructure differences across the Asia-Pacific region
1.5.1 Improving payment solutions for the existing customer: the growth of developed Asia-Pacific countries
1.5.2 Banking the unbanked: China and India are important in the emerging Asia-Pacific
1.6 Consumer confidence fostering spending
1.7 The mobile payment method reflects the mobile subscription gap between developed and emerging Asia-Pacific
1.7.1 Catching up with mobile payments: China alone will reduce the gap in the Asia-Pacific region
1.7.2 Going mainstream? Making mobile payments work and promoting near field communication
1.8 From high growth margins to saturation prospects: The e-commerce gap between developed and emerging countries in the Asia-Pacific region
2 China’s ambition: from an emerging country to a worldwide leader in the mobile and prepaid card payments
2.1 In accordance with the expanding economy, the Chinese payment methods will expand
2.2 Chinese government stimulating card acceptance through interchange fees policies
2.3 China UnionPay’s latest expansion-focused deals
2.3.1 China UnionPay and NYCE partner for mutual benefits
2.3.2 China UnionPay partners with Elavon
2.3.3 Using China UnionPay online cards to develop Chinese e-commerce
2.4 China’s Five-Year Plan: stimulating online payment trends
2.5 From cash to mobile payments, through cards: the growth of the Chinese mobile payment market
2.5.1 China mobile payments system is expanding
2.6 A more transparent prepaid card system is needed in China
3 The Indian payment systems moving in line with the country’s social transformation
3.1 The Indian cash-based society increasingly adopting the use of debit cards
3.1.1 Banking the unbanked population through Aadhaar
3.2 The increasing internet use is developing Indian e-commerce
3.2.1 Leading companies in the Indian e-commerce business
3.3 The unbanked Indian population is the country’s prerequisite for increasing prepaid card adoption
3.3.1 India Post driving the future of prepaid cards
3.3.2 The Prepaid Indian Forum is undertaking initiatives to develop prepaid card use
3.3.3 Combining efforts to reduce the unbanked: ITZ Cash Card, DCB and Visa launching India’s first multipurpose prepaid card
3.4 The potential of mobile payments exists, although it is a long way to full maturity
3.4.1 The infrastructure challenge
3.4.2 Mobile solutions for the unbanked population
3.4.3 The future of Indian mobile payment
3.5 Indian mobile banking services are far more developed than mobile payment service
3.5.1 Extending mobile banking services to the unbanked: internet mobile payment service
4 The expansion of e-money and the very early development of mobile payments: Indonesia
4.1 The Indonesian banking industry
4.1.1 The forthcoming card chip implementation bringing costs to Indonesian banks
4.1.2 The “blocking the fraudster account” measure to fight card fraud
4.1.3 New credit card rules to protect banks from bad debts
4.2 The wide expansion of e-money
4.2.1 Rising authorities’ concerns around the issuance of e-money
4.2.2 Telkomsel is the leading non-bank company in the Indonesian e-money business
4.2.3 Bank Negara Indonesia and Bank Mandiri are seeking more e-money customers
4.3 Solid foundations for the mobile payment market are being built
4.4 Despite its strong foundations, it is too early for mobile payments to become fully adopted
5 The Hong Kong payment system is seeking growth drivers
5.1 The Hong Kong prominence of credit cards
5.2 Consolidating outstanding debts as a driving factor
5.3 Banks setting high credit card APRs to discourage credit card debts
5.4 The dual currency market as a credit card magnet
5.4.1 Bank of China and China UnionPay provide dual currency cards
5.4.2 Initiatives in dual currency payment methods
5.4.3 Dual currency credit cards are a gold mine
5.5 Other drivers of the Hong Kong payment system
6 The mature Australian payment card market
6.1 Credit cards widely used for high-value transactions
6.2 Four banks dominate the Australian credit card market
6.2.1 Commonwealth Bank of Australia as the leading credit card issuer
6.2.2 WestPac
6.2.3 Australia and New Zealand Banking Group
6.2.4 National Australia Bank
6.2.5 Citigroup
6.2.6 ING Direct
6.3 Australian consumer preferences are changing from credit cards to debit cards
6.4 Contactless payments is far from being fully implemented
6.5 Despite their high penetration rate, mobile payments are not popular among Australians
6.5.1 CBA confirms its role of leading promoter of technological payment devices
7 More cashless than ever: Japan
7.1 A competitive prepaid cards market
7.2 Japan has the most mature mobile payment system
7.3 Despite its competitiveness, the Japanese mobile market is open to opportunities: a few case studies
7.3.1 From telecom leader to credit issuer: The case of DoCoMo
7.3.2 Deploying NFC technologies to gain market share: KDDI
7.3.3 Following EMobile’s initatives: opportunities for new entrants
8 Predominantly based on credit cards, with a rising prepaid payment methods and established mobile payment infrastructural settings: South Korea
8.1 The developed South Korean card payment system
8.2 The increasing number of South Korean prepaid cards
8.3 The South Korean mobile market
8.3.1 The development of smartphones is facilitating the expansion of the South Korean mobile payment systems
8.3.3 Future Competition Challenges: The LTE race
9 Overcoming the dependence on cash: Malaysia
9.1 Central bank regulations will reduce credit card usage
9.2 The new ways of banking in Malaysia: internet and mobile banking
10 Seeking profitability in a saturated card market: Singapore
11 Thailand has a highly cash-based payment system
11.1 Developing the payment card market through central bank regulations
11.2 EFTPOS terminals as the driver of the Thai card market
12 An Asia-Pacific to be exploited
12.1 Taiwan
12.2 The Philippines

List of Tables

List of Figures
Figure 1 : Debit cards are far more popular and increasing at a faster rate than credit cards (million), 2006-2015
Figure 2 : Global EMV coverage and adoption rate, 3Q 2011
Figure 3 : Mobile subscribers in China by operator (million), November 2011
Figure 4 : Consumer confidence index of countries in the Asia-Pacific, 3Q 2011
Figure 5 : South Korea and Japan are leading countries for mobile broadband penetration. Active mobile broadband subscriptions per 100 inhabitants
Figure 6 : The exponential growth of Chinese mobile payment users (million), 2009-F2014
Figure 7 : Asia-Pacific share of global mobile payment users (million), 2009-F2014
Figure 8 : The global NFC mobile marketing alliance
Figure 9 : Chinese consumer spending across urban districts is rising, while spending in rural districts is declining, 2005-F2015
Figure 10 : China Union Pay overtaking Visa as the leading worldwide credit card scheme (% market share)
Figure 11 : Chinese internet users and internet penetration rate, 2006-F2015
Figure 12 : The growth of Chinese e-commerce by new internet users and e-shoppers (million), 2005-F2015
Figure 13 : Online transactions in China, 2005-2013
Figure 14 : Chinese mobile payment market size, 2009-F2013
Figure 15 : China’s SIMpass
Figure 16 : China’s prepaid card market value, 2008-E2011
Figure 17 : Convenience is the most attractive characteristic of prepaid cards
Figure 18 : The Chinese multipurpose prepaid market still growing (CYN billion)
Figure 19 : India’s middle class exponential growth, 2011-F2030
Figure 20 : The decline of cheques and rise of debit cards, 2008-2010
Figure 21 : Indian internet users (million), 2008-F2012
Figure 22 : Share of the Indian e-commerce revenues by industry ($ million), 2009-F2012
Figure 23 : Ogone’s territorial coverage
Figure 24 : Indian prepaid card growth projections
Figure 25 : Indian prepaid card issued by leading companies (thousand), 2011
Figure 26 : The increasing trend of remittances in India, 2005-E2011
Figure 27 : ITZ Cash Card/DCB/Visa Freedom prepaid card
Figure 28 : Total and active mobile connections (million), 2006-2011
Figure 29 : Reducing foreign direct investment in the Indian telecom services ($ billion), 2009-2011
Figure 30 : Number of mobile service users by bank (million), 2010
Figure 31 : Number debit and credit cards in Indonesia, 2007-2011
Figure 32 : The leading non-bank companies offering e-money services, 2Q 2011
Figure 33 : Bank Mandiri e-toll card
Figure 34 : Bank Mandiri’s e-money cards accounted for the largest proportion of Indonesian e-money transactions, 2011
Figure 35 : Indonesia’s increasing internet users (million), 2007-2011
Figure 36 : Indonesian mobile subscriber penetration rate (million), 2008-E2011
Figure 37 : The rising popularity of smartphone and 3G-enabled mobiles (million), 2010-F2014
Figure 38 : China UnionPay and China Construction Bank dual-currency credit card
Figure 39 : Transactions value by method of payment (A$ billion and annual growth rate), 2010
Figure 40 : The Australian contactless pioneer: CBA Prepaid Travel Money Card
Figure 41 : Australian credit card market share, 2011
Figure 42 : Debit cards are becoming increasingly popular in Australia, 2007-2010
Figure 43 : Average value of contactless payments (A$), 2010
Figure 44 : Mobiles are still used for applications rather than online banking and purchases (percentage of respondents), 2010
Figure 45 : The Commbank Kaching application
Figure 46 : Edy is the leading prepaid issuer in Japan, 2010
Figure 47 : The growth of credit and prepaid e-money transactions (¥ trillion)
Figure 48 : DoCoMo the leading mobile provider in Japan, 2011
Figure 49 : The three leading Japanese mobile operators will retain their market share in 2012. Number of mobile subscribers (million), 2009-F2012
Figure 50 : Retail and convenience stores are popular mobile payment locations (million mobile payment customers), 2010-2011
Figure 51 : DoCoMo credit card receivables, 2009-2011
Figure 52 : Growth in the number of EMobile customers in Japan (million), 2007-2011
Figure 53 : EBITDA margin for EMobile in Japan, March 2007-March 2011
Figure 54 : The share of cashless payment instruments in South Korea, 2010
Figure 55 : South Korean credit card and debit card transaction values (KRW trillion), 2006-2010
Figure 56 : The Korean Pass Card
Figure 57 : The South Korean T-Money
Figure 58 : The growth of the mobile payment in South Korea (KRW billion), 2005-2011
Figure 59 : The rapid growth of South Korean smartphone users (thousand), Oct 2009-Sep 2011
Figure 60 : Internet banking has become highly popular in Malaysia, 2005-2011
Figure 61 : Malaysian mobile banking subscribers, 2005-2011
Figure 62 : Market share of card payment instruments in Singapore, 2010
Figure 63 : The growth of ATM and EFTPOS terminals in Thailand, 2004-F2012
Figure 64 : Number of prepaid cards in Thailand (million), 2006-2011

Published By: Timetric
Product Code: Timetric142

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