Mobile Payments Linked to Credit Cards on the Rise Despite Security Concerns, J. D. Power Finds
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American Express Ranks Highest in Credit Card Satisfaction
Singapore: 28 November 2017 — With Singapore striving to become a cashless economy, credit card holders are following suit through increased usage of mobile payment services, particularly compared to other key global markets, according to the J.D. Power 2017 Singapore Credit Card Satisfaction Study,SM released today.
The study finds that in Singapore, usage of mobile payments (40%) has grown by 53% since last year and is significantly higher than in the United States (23%) and Australia (14%) and at the same level as Hong Kong (41%), despite the fact that security is the concern most often cited by consumers for not using a mobile wallet.
“Singapore cardholders are increasingly moving toward mobile payment platforms,” said Anthony Chiam,Service Industry Practice Lead at J.D. Power. “However, in order for cardholders to fully embrace the adoption of these services, trust is paramount and security concerns must be first addressed.”
The study also finds that lack of rewards and loyalty points and low merchant acceptance at retail stores/ restaurants are the main reasons that cardholders do not use their primary card for mobile wallets (42% and 20%, respectively). More than three-fourths (79%) of cardholders have a rewards programme, with satisfaction among this group 31 points higher (on a 1,000-point scale) than among those cardholders who do not (734 vs. 703, respectively).
In addition, cardholders with a rewards programme spend 29% more than those who do not have such a programme ($1,035 vs. $802 per month, respectively). Unexpectedly, only 26% of cardholders say they completely understand how to earn and redeem through their rewards programme.
Following are additional key findings of the study:
- Most popular payment mode: With so many payment options available, credit card remains the most popular mode when paying for purchases in stores/ restaurants and online payments.
- Online channel still popular: Interaction via websites has also grown to 83% this year from 76% last year. In contrast, usage of traditional channels is lower, with automated phone usage growing to 31% from 21% year over year and live phone interaction growing to 45% from 40%. Satisfaction among cardholders who use the online channel is lower than among those who use a mobile app (736 vs. 753, respectively).
- Key factors for card decision: Rewards programme (37%); cashback (50%); and discounts and promotion (33%) are the key features that cardholders look for in selecting their primary card.
American Express ranks highest in credit card satisfaction with an overall score of 781 and performs well across five of six factors. Standard Chartered ranks second with a score of 748, while DBS ranks third with a score of 737.
The 2017 Singapore Credit Card Satisfaction Study examines customer satisfaction with the products and services provided by their main financial institution. The study measures overall satisfaction in six key factors (in order of importance): interaction (37%); billing and payment (19%); credit card terms (13%); benefits and services (13%); rewards (13%); and problem resolution (4%).
The study is based on responses from 2,903 credit card customers. Coverage includes 11 major credit card issuers in the market, nine of which are rank-eligible, with satisfaction scores based on the customer’s primary card used. The study was fielded in September-October 2017.
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About J.D. Power in the Asia Pacific Region
J.D. Power has offices in Singapore, Bangkok, Beijing, Shanghai and Tokyo that conduct customer satisfaction research and provide consulting services in the automotive, information technology and finance industries in the Asia Pacific region. Together, the five offices bring the language of customer satisfaction to consumers and businesses in Australia, China, India, Indonesia, Japan, Malaysia, Philippines, Taiwan, Thailand and Vietnam. J.D. Power is a portfolio company of XIO Group, a global alternative investments and private equity firm headquartered in London, and is led by its four founders: Athene Li, Joseph Pacini, Murphy Qiao and Carsten Geyer. Information regarding J.D. Power and its products can be accessed through the internet at asean-oceania.jdpower.com.
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