If you are more comfortable dealing with digital money than cash, there is good news for you: Singapore, one of the most prominent and influential economies in the world, has announced its intention to move towards being a cashless society. While talking to journalists, Ong Ye Kung, the Education Minister of Singapore and a member of the Monetary Authority of Singapore, made clear the government’s intention to reduce the use of cheques and cash as modes of payment. As a matter of fact, Ong also said that the government plans to make the island a cheque-free country by 2025.
Is the Government Chasing an Impossible Dream?
The simple answer is no; the statistics actually talk in favour of the government’s intention, and it is quite likely that the government will easily be able to reach its target by the set deadline.
In recent years, e-payment has established itself as the most secure way to transfer money. Ong informed the journalists that e-payment has increased by $10 billion a year in the recent past. He further told journalists that in Singapore, eight of every ten consumers use e-payments to transfer money, and every three of five merchants accept e-payments. Thus, the scenario looks good for the government to go ahead with its plan of making Singapore a cashless society by 2025.
The government of Singapore is wholly committed to the idea of making Singapore a cashless and cheque-free country and has been working on carving out effective strategies that will help the government reach its goal. The latest approach adopted by the government is promoting instantaneous online payments. While using this mode of payment, users use phone numbers to transfer money and thus, are not required to disclose their banking details. In Singapore, instantaneous online transfers are completed using the PayNow transfer service, which was launched last year. PayNow is unique in the fact that users can use it to make online transactions without disclosing their bank details. The transfer service recorded a transaction volume of approximately $900 million and has successfully registered over 1.4 million users so far. While using PayNow, users do not have to worry about payee details as all of the data used by the company is stored in a central repository, which is managed by a third party.
Seven renowned banks — DBS, HSBC, UOB, OCBC Bank, Maybank, Citibank, and Standard Chartered Bank — have already given a green signal to PayNow and it is expected that this fund transfer service will play a pivotal role in helping the government realise its dream of making Singapore a cashless society. These days, more and more government agencies are beginning to use this platform to perform disbursements.
Government to Introduce Payment Service Bill to Safeguard Consumers Against E-Payment Risks
Around the world, governments are making conscious efforts to turn economies into cashless societies. Singapore is no different in this regard. In the recent past, cash withdrawal from ATMs has reduced by more than $300 million a year. This decline in cash withdrawal using ATM machines denotes a significant shift in the preferences of the citizens. In other words, it simply means that Singaporeans are shifting away from the traditional methods of money transfer.
The data released by various trustworthy organizations and sources also show that the cheque transaction volume has reduced continually in the recent past. As compared to 37% in 2015, the cheque transaction volume reached its lowest share of 28% last year. These figures clearly indicate that the government of Singapore is chasing a realistic dream, one that is well-aligned with the preferences of Singapore’s citizens, and with the right strategies and measures, it will actually be easy for the government to accomplish its target of making Singapore a cheque-free country by 2025.
Electronic payment methods are easy-to-perform and lead to an overall hassle-free experience. Further, given today’s hectic lifestyle and busy schedules, most users do not have the time to stand in queues to submit a cheque. Electronic payment methods make it easier for users to make monetary transfers as and when needed. However, Ong cautions that with e-payment systems come in the risk of fraud. The government is, thus, planning to introduce a new Payment Service Bill later this year to safeguard the interest of consumers and protect them against e-payment risks.