Despite the dominance of cash, Hong Kong has made a steady progress in the adoption and use of payment cards. The convenience of electronic payments, robust payment infrastructure and the emergence of contactless payments are expected to drive the total number of card payments from 642 million in 2015 to one billion in 2020, according to GlobalData, a data and analytics company.
Hong Kong has a highly penetrated payment card market, with each individual holding more than three cards in 2019.
This is supported by the government and banks’ efforts to provide banking services even in remote areas, and expand banking infrastructure through the introduction of mobile banking branches, new physical bank branches, and the establishment of virtual banks.
GlobalData’s Payment Cards Analytics reveals that Hong Kong’s payment card market is mainly driven by credit and charge cards, which accounted for 67.9% of total card payment value in 2019. The total card payment value in the territory is forecast to increase from HK$43.3 billion (US$5.57 billion) in 2019 to HK$59.6 billion in 2023.
Nikhil Reddy, banking and payments analyst at GlobalData, explains: “The pricing benefits such as referral programs, instalment facilities, cashback and discounts associated with credit and charge cards are some of the key reasons for their preference. In addition, these cards are increasingly preferred for online shopping and for transactions overseas.”