8 | | MARCH - 2020IN MY OPINIONDIGITAL PAYMENTS AS A GROWTH ACCELERATOR FOR OFFLINE BUSINESSESBy Khuan Yew Lee, Head of Product, FaveExpansive growth of mobile paymentsGone are the days when banks are the only service providers in the financial world. Banking services could remain relevant in the industry for banks that have disrupted themselves and transformed to serve the real needs of people. By observing and often experiencing first-hand what banks offer and do not offer, new entrants see opportunity in disaggregating the components of traditional banking by offering products targeting the unserved and underserved segment of consumers and businesses with better value not just in the form of money, but also user experience and customer service.Mobile payments by these innovative fintech companies have been on the rising trend in various parts of the world, including Southeast Asia. Most of them started as start-ups funded by investors, while some are new subsidiaries backed by large corporates. Regardless of which, vast sum of money has been invested in hopes of acquiring more customers as well as changing user mindset and behavior. As a result, these expensive marketing campaigns and promotions have undoubtedly helped in raising public awareness and educating users to a certain extent, but unfortunately user adoption and usage are too reliant on the unsustainable subsidies as active customers and transactions are observed to have significant fall during the absence of attractive promo codes or cashback. Acceleration of offline businesses to the e-ConomyDespite most, if not all, e-wallet players subsidizing the transaction processing fee commonly known as Merchant Discount Rate (MDR) and funding all the marketing incentives utilized by their customers, many brick-and-mortar stores have yet to digitalize their business. While these conventional offline businesses observe the market shift towards digital payments, what is more important for these business owners is knowing how the transformational move can help them to solve their day-to-day problems and grow their overall business.Understanding the needs and wanting to help these merchants grow their businesses, Fave which is currently operating in 36 cities in Singapore, Malaysia and Indonesia across multiple categories including F&B, retail and services is committed to accelerate the transition of offline businesses to the digital economy through its digital merchant platform, FaveBiz, which provides a suite of services from payments to marketing and loyalty, operations, data as well as financing.Enabling cashless payments beyond universal acceptanceBeing able to accept all if not the most common, types of payment is rather important for businesses. Aside from cash and card payments, offline businesses are now expected to also accept mobile payments. A plethora of QR codes can now be seen on the overcrowded cashier counter with multiple card terminals as well as point-of-sale (POS) system with scanner and printer. While Alipay and WeChat Pay are now the duopoly of China, other countries with numerous QR payment issuers like India, Singapore, Malaysia, and Indonesia have Mobile payments by these innovative fintech companies have been on the rising trend in various parts of the world, including Southeast Asia.
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