Digital wallets are revolutionizing cross-border payments in Singapore, but a wide gap in consumer awareness is slowing broader adoption, according to the latest “Global Money Movement: Singapore Edition” report by PYMNTS Intelligence in collaboration with TerraPay.

Based on data collected from 2,757 consumers and 89 small to mid-sized business leaders between September and October 2024, the study shows a clear divide: while 84% of merchants are highly familiar with digital wallets, only 56% of consumers say the same.

This disparity poses a major hurdle to mass adoption. Interestingly, consumers who are familiar with digital wallets are 30% more likely to use them, suggesting awareness is a powerful trigger for usage.

Speed tops the list of motivators for potential users, with 45% of consumers and 64% of merchants citing faster transactions as a key incentive to adopt digital wallets over the next year.

However, security concerns remain the top barrier. Among consumers who haven’t yet adopted digital wallets, 36% cite security fears, with 27% identifying it as their primary concern. Among businesses, 42% express similar worries, although only 17% rank it as the most critical issue.

The report highlights generational and income-based trends, noting that Gen Z, millennials, and higher-income individuals are more likely to use digital wallets. For businesses, usage typically centers around supplier payments and bills, while consumers mainly rely on them for remittances.

Challenges such as usability issues (32%) and access to funds (34%) also impact merchant adoption.

To bridge the awareness gap and accelerate adoption, the report urges financial institutions and payment providers to launch initiatives that improve consumer education and enhance security protocols.

Ultimately, driving greater awareness, addressing usability challenges, and building trust will be key to establishing digital wallets as a mainstream financial tool in Singapore’s evolving digital economy.

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News Source: Pymnts.com