While Singapore may be considered one of the most technologically advanced and forward-thinking countries on Earth, in a speech on Sunday to mark the city-state’s National Day, Prime Minister Lee Hsien Loong couldn’t help but notice that the Lion City was eating China’s dust in one important area.
“In major Chinese cities — cash is already obsolete and even debit and credit cards are becoming rare,” Lee told his audience as an Alipay logo flashed up on a giant LCD screen behind him. While “smart” people in Chinese cities are free to pay for anything, from taxi rides to snacks on the street, with just a QR code, those in Singapore are stuck in the comparative stone age, with as many as six in 10 transactions still conducted with cash or check, Lee pointed out.
“When visitors from China find that they have to use cash here, they ask: ‘How can Singapore be so backward?'” he said.
There are of course a number of reasons why the likes of Alipay and WeChat Pay have taken off so rapidly in China while other supposedly more advanced countries continue to labor on with plastic and paper. Unlike in places like Singapore, credit cards never really caught on in China, so when Alipay suddenly began offering a safe and extremely convenient method of payment online and later out in the real world, Chinese consumers quickly jumped all over it.
These days, as Lee notes, anyone — local or foreign — who lives in a major Chinese city but says that they don’t have Alipay or Wechat gets an odd look when they arrive at the cash register.
Lee cited an anecdote that was shared with him by his labor minister Lim Swee Say from an experience he had in Shanghai a few years ago queueing to buy chestnuts from a roadside stall.
“He saw people in front of him waving their handphones before taking their chestnuts and leaving, without paying any cash,” he said. “So being Singaporean, he thought there must be some special offer.”
“When it came his turn, he confidently said, ‘I do not need the special offer, I will pay the full price in cash!’ The hawker did not say anything – just gave him a quizzical look and pointed him to the QR code. And that was then he realised the QR code was for WeChat Pay and he was the suaku one!” Lee added, using a Singlish term for ‘country bumpkin’.
Mobile payment systems have been taking off in different countries throughout South and Southeast Asia. There’s Paytm in India (with over 200 million users), Ascend Money in Thailand and Mynt in the Philippines — all of which happen to have partnerships with Alipay owner Ant Financial.
However, Singapore is a bit different — a developed country in the heart of a developing region of the world — but while some might question the need for a country like Singapore to switch from credit cards and cash to mobile payments, its prime minister sees it as a change that needs to be made.
“[It is about] using IT comprehensively to create new jobs, new business opportunities, to make our economy more productive, to make our lives more convenient, and to make this an outstanding city in which to live, work and play,” PM Lee said.
Meanwhile, Singapore’s government is apparently wasting no time in getting onboard with mobile payments. Currently, Chinese visitors to Singapore can already pay fares in 80% of the country’s cabs in RMB via Alipay, while the same app is accepted by 2,000 merchants across the city including Universal Studios Singapore and Singapore Zoo.
At the same time, the government plans to roll out 25,000 unified-point-of-sales terminals that will accept credit cards and contactless mobile phone payments over the next 18 months as well as a new “common QR code” to facilitate payments within six months.
Shanghai-based expats often complain that the thing they miss most when they go home is how incredibly easy it is to pay for things in China. If more countries come around to Singapore’s way of thinking, that may not be the case for too much longer.
Don’t believe us? Check out what the future of shopping looks like with a tour through Alibaba’s Hema supermarket in this video that went viral not so long ago.