Asia-Pacific has grown into the world's largest market for cashless transactions. Find out what are the top APMs here.
Alternative payment methods are gradually making their presence felt. But can they help your business take advantage of the coming mCommerce revolution?
Is your business prepared for the rise of mobile commerce? If so, have you considered making use of alternative payment methods (APMs)? Keep reading to see why APMs may be just the edge that you need.
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According to a 2021 survey, Indonesia, India, South Korea, and Australia were regarded as one of the most mobile-orientated nations in the world, with Indonesians spending up to 5.5 hours a day on their phones.
So, how do you as a business owner leverage the fact that mobile usage is likely to continue growing in the years to come — enter the world of mCommerce.
What is mCommerce, and Why Does It Matter?
If you’ve ever bought anything with a smartphone or mobile device, then congratulations. You’re now a part of the mCommerce market.
mCommerce or mobile commerce is the next phase of eCommerce. More consumers have begun shopping online with their mobile devices thanks to rising smartphone and internet penetration.
So, why does buying a pair of shoes online with your smartphone matter so much?
Well, the answer is simple. Less than 15 years ago, you would have shopped online using a computer. But nowadays, you need to whip out your smartphone, open up your favourite eCommerce app and start shopping.
Studies show that in 2021, mobile users were responsible for a stunning 72.9% of global eCommerce purchases. And this number is only going to increase in the years to come with further smartphone penetration.
With its vibrant economy, strong logistics network, and significant unbanked population, Asia Pacific is set to benefit most from the m-commerce revolution.
4 Major Reasons Why APMs Are Crucial to Mobile Commerce
Now, let’s examine why alternative payment methods can help your business access the mCommerce space.
1. Access previously unreachable customers
As was mentioned above, Asia Pacific has a large community of unbanked customers. Some exist in remote areas where access to financial services is difficult or even impossible.
However, the widespread availability of smartphones and rising internet penetration make for an exciting combination. That’s because these isolated communities can use their smart devices to access the eCommerce market and use e-wallets to pay for their purchases.
E-wallets like Touch n’Go can be topped up with reload cards purchased at local retail outlets. This makes it exceptionally easy for unbanked individuals to participate in the global e-commerce community.
2. Offer better payment experiences
APMs offer mobile users a much smoother payment experience than credit/debit cards.
And why is this so?
That’s because they do not require customers to input their banking details or card numbers. And if you’ve ever shopped with your mobile device, you’ll know how important this is.
With an APM, customers only need to scan a QR code or key in their PINs. Once that’s done, they’re all set and ready to pay for their purchase.
This makes for a much smoother, fuss-free payment experience, which is something highly prized by both mobile and non-mobile customers.
Because of this, it’s not enough to prepare a mobile-friendly website. Instead, merchants need to evolve and start offering mobile-friendly payment solutions. Failing to do so will likely lead to a loss of sales and a hit to your business’s reputation.
And why is this so?
That’s because they do not require customers to input their banking details or card numbers. And if you’ve ever shopped with your mobile device, you’ll know how important this is.
With an APM, customers only need to scan a QR code or key in their PINs. Once that’s done, they’re all set and ready to pay for their purchase.
This makes for a much smoother, fuss-free payment experience, which is something highly prized by both mobile and non-mobile customers.
Because of this, it’s not enough to prepare a mobile-friendly website. Instead, merchants need to evolve and start offering mobile-friendly payment solutions. Failing to do so will likely lead to a loss of sales and a hit to your business’s reputation.
Learn how XanPay streamlines eCommerce payments.
3. Meet changing customer demands
The world of eCommerce is highly competitive, so you need to be prepared for constantly changing customer demands.
Currently, mobile purchases make up the bulk of eCommerce transactions, and this is not likely to change anytime soon. By making alternative payment methods a part of your business, you can ensure that you’re catering to your customer’s expectations.
Besides meeting current expectations, this has the added advantage of allowing you to reach out to new markets and consumers. And by doing so, you expand your reach and further diversify your customer base.
4. Move beyond borders and access new markets
While credit/debit card payments are usable for cross-border transactions, the additional requirements and added costs can be prohibitive — however, APMs present customers with an exciting alternative (pun intended).
For example, countries in Southeast Asia, including Malaysia, Singapore, Thailand, and
Indonesia, have signed an agreement that links their QR code payments systems.
This will allow customers to perform bank transfers to users in partner nations seamlessly. All they have to do is scan a QR code, and they’re good to go.
From the perspective of an online merchant, this is extremely exciting as it eliminates much of the complexities associated with cross-border transactions.
For example, countries in Southeast Asia, including Malaysia, Singapore, Thailand, and
Indonesia, have signed an agreement that links their QR code payments systems.
This will allow customers to perform bank transfers to users in partner nations seamlessly. All they have to do is scan a QR code, and they’re good to go.
From the perspective of an online merchant, this is extremely exciting as it eliminates much of the complexities associated with cross-border transactions.
Types of Alternative Payment Methods
1. E-Wallets
Currently one of the most popular apps, e-wallets have a strong presence across the Asia Pacific region. Most e-wallets are provided by homegrown super apps like Grab, GoJek, GoTo, and Paytm.
E-wallets became prominent during the COVID pandemic due to preferences for contactless payment and government initiatives. Countries like Malaysia have successfully used e-wallets such as Touch n’ Go to distribute aid amongst hard-to-reach communities in isolated areas.
2. Bank transfers
Bank transfers are the second-most popular alternative payment method around. These make use of real-time payment (RTP) systems to bank-in funds directly to a merchant’s account without having to use credit/debit cards.
Such methods are utilised by both eCommerce and brick-and-mortar merchants throughout Asia. Some of the most popular APMs supported by these businesses include DuitNow and PayNow in Malaysia and Singapore, respectively.
One example of how APMs have facilitated mobile commerce can be seen through the microenterprise market in Malaysia.
Merchants on social media sites such as Instagram can quickly accept payment by sending over an image of their DuitNow QR code. The customer only needs to scan the presented code to transfer their funds.
3. Cryptocurrencies
Also called digital assets, cryptocurrencies consist of tokens such as Bitcoin, Ethereum, and Litecoin. Despite being highly volatile and 100% unregulated, cryptocurrencies are sometimes used as an alternative payment method.
As cryptocurrencies exist in their own ecosystem, users can transfer large sums of money instantly with minimal fees. Besides that, the unregulated nature of the crypto market means that users have essentially zero oversight.
However, its inherent volatility makes it somewhat unsuitable as an alternative payment method for mainstream businesses. But this doesn’t mean that cryptocurrencies don’t have a role to play in the future.
If you intend to use these assets, always check to ensure that you’re not breaking any laws in your country.
As cryptocurrencies exist in their own ecosystem, users can transfer large sums of money instantly with minimal fees. Besides that, the unregulated nature of the crypto market means that users have essentially zero oversight.
However, its inherent volatility makes it somewhat unsuitable as an alternative payment method for mainstream businesses. But this doesn’t mean that cryptocurrencies don’t have a role to play in the future.
If you intend to use these assets, always check to ensure that you’re not breaking any laws in your country.
XanPay: Opening The Doors To The mCommerce Revolution
So, as you can see, alternative payment methods allow businesses to participate in the mCommerce revolution.
Embrace the future of transactions, take control of your financial future today. Start exploring the limitless possibilities of the future of transactions.
But to make it all work, you need a unified payments platform that helps you tie it all together. And for that, there’s XanPay, which offers:
Asia-Pacific has grown into the world's largest market for cashless transactions. Find out what are the top APMs here.
Asia-Pacific has grown into the world's largest market for cashless transactions. Find out what are the top APMs here.