HONG KONG | GlobalData revealed that alternative payment solutions were the preferred method for e-commerce purchases in Hong Kong (China SAR), collectively accounting for 41.7 per cent of the market in 2023.
The e-commerce market in Hong Kong grew by 10.5 percent in 2023 to reach HKD160.3 billion ($20.5 billion) as more consumers shifted from offline to online purchases. The market is estimated to grow by 13 percent to reach HKD181 billion ($23.1 billion) in 2024.
“The e-commerce sales in Hong Kong have been growing at a robust pace, supported by the rising internet and smartphone penetration, robust online payment infrastructure, and increasing consumer confidence in online transactions,” said Ravi Sharma, Lead Banking and Payments Analyst at GlobalData.
According to the Office of Communications Authority, 96.9 percent of households had broadband internet connections as of April 2024. Online shopping festivals such as Black Friday, Cyber Monday, and Singles’ Day have contributed to the overall growth of e-commerce in Hong Kong.
Alternative payments were the most preferred tool for e-commerce purchases. They collectively accounted for a 41.7 percent share in 2023, a trend prevalent in many Asian markets. This was mainly due to their simplicity, speed, and convenience.
To capitalise on market opportunities, payment solutions providers have been rolling out new features designed to boost user engagement and adoption.
For example, in January 2023, Samsung introduced the Samsung Wallet, which combined the existing features of Samsung Pay with additional functionality. Users could also store and access digital keys, boarding passes, and essential documents such as ID cards and driving licenses within the wallet.
Payment cards followed alternative payment solutions, which accounted for 38.6 percent of the total e-commerce transaction value in 2023. This has been attributed to convenience and pricing benefits such as cashback, discounts, reward points, and instalment payment options available with these cards.
Due to the growing popularity of electronic payments, the cash on delivery share has declined to a mere 6.3 percent.
“Hong Kong’s e-commerce landscape continues its upward trajectory, poised for substantial growth between 2024 and 2028, with an anticipated compound annual growth rate of 9 per cent in transaction value to reach HKD 255.7 billion ($32.7 billion) in 2028.”
Sharma added that alternative payment solutions were expected to continue their growth and lead e-commerce payments in Hong Kong.
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