An Overview of Digital Wallets in Hong Kong in 2020

An Overview of Digital Wallets in Hong Kong in 2020

by January 20, 2020

Hong Kong has been pushing for greater development and adoption of digital and mobile payments with the Hong Kong Monetary Authority (HKMA) beginning issuing stored value facilities (SVF) licenses in 2016 and virtual banking licenses in March 2019.

Over the past year, nearly nine in ten consumers in Hong Kong have used a digital wallet, according to the Digital Payments Landscape in Hong Kong 2019 report by Tofugear and Wirecard, underlining that there is a genuine willingness to engage with new payment methods.

According to JP Morgan’s report digital wallets are the second most popular payment option in Hong Kong, with close to US$ 1 billion transactions annually. The same report expects digital wallets to grow faster than card transactions to 2021, expanding at a compound annual growth rate of 32 percent.

Hong Kong’s adoption of digital wallet is best demonstrated by the fact that the city has seen more than half of its population signed up for the Faster Payment Systems.

The Faster Payment System was introduced in September 2018 and it is an interoperable system allows anyone to perform money transfers using only mobile numbers or email addresses.

According to South China Morning Post, the Faster Payment System saw average daily transaction volumes between HK$ 2.4 billion  (US$ 308.82 million) and 38 million yuan.


Digital wallets in Hong Kong

In Hong Kong, the HKMA had granted 16 organizations with SVF licenses, as of March 2019, and about ten of them now have digital wallets that are operational, according to the report.

AlipayHK and WeChat Pay HK are amongst the most popular ones. Both provide functions for top-up, online payment, merchant payment and peer-to-peer (P2P) transfer payment. AlipayHK also supports bill payments, while WeChat Pay HK allows for in-person money transfers and global money transfers.

Users can top up their account using cash at stores including Circle K outlets and McDonald restaurants, via designated banks, or by using credit cards. They can also bind their account to these cards for making purchases and payments.

More than 50,000 stores in Hong Kong accept AlipayHK, including major fast food and convenient store chains, and nearly 300 offline merchants, such as department stores and travel agents, accept WeChat Pay HK.

Another popular digital wallet in Hong Kong is PayMe, a service developed and operated by HSBC. The platform primarily focuses on P2P payments and users do not need to be with HSBC to use the app. Users link a HSBC account or Visa/Mastercard credit cards for top ups. Transfers can be made through the app itself, WhatsApp message, SMS or Facebook Messenger.

HSBC extended PayMe to startups and other small businesses in Hong Kong in June 2019.

Apple Pay is another widely used digital wallet in Hong Kong. The service launched in 2016 in the territory, promising users high security and convenience. The app can be linked to eight credit and debit cards, and users can use it to pay at more than 10,000 Hong Kong grocery stores, boutiques, restaurants and more.

O! ePay is a network-based stored value service operated and managed by payments company Octopus Cards. It is one of the leading digital wallet services in Hong Kong, enabling users to perform P2P payments, make fund transfers between an O! ePay account and a registered Octopus (a rechargeable contactless smart card available in Hong Kong), make online payments and make fund transfers through the Faster Payment System from/to any bank account and e-wallet account.

O! ePay and Octopus are widely accepted by major transport operators, retail stores, online merchants, parking facilities, schools, and more.

Tap & Go is a prepaid mobile wallet service for Android and iOS smartphones users to settle payment at designated merchants through Mastercard contactless technology. Users can also use it for both overseas and online purchases and to make instant money transfers. The mobile wallet can be topped up through bank transfer, at ATMs, or with cash at 7 Eleven and Circle K convenient stores, among other outlets.

TNG Wallet is a digital wallet claiming to have over 600,000 downloads and user base comprising approximately 8% of Hong Kong’s population. The service can be used to make online and offline purchases, settle bills, transfer money, and more. Users top up their account via credit card, through bank transfer, at ATMs, or using cash at 7 Eleven stores.

In December 2019, TNG expanded its offering and launched the TNG Mastercard prepaid card. The card is linked to the TNG Wallet and users can view their spending record and account balance real-time on the app.

Other digital wallets available in Hong Kong include Google Pay, formerly Android Pay, and Samsung Pay.