Why do Taiwan’s consumers shun payment cards?

Why do Taiwan’s consumers shun payment cards? Photo: Phasuthorn Design,
Written by Arnie Cho

Arnie Cho suggests providers provide incentives to help consumers in Taiwan swap cash for payment cards.

While Taiwan has the necessary infrastructure and each consumer has an average of six cards, payment cards are not used frequently compared to most other markets with a mature infrastructure in place.

According to GlobalData’s Payment Cards Analytics dashboard, in Taiwan each debit card is used an average of only once a year, while credit and charge cards are used for around 25 transactions each year. These figures are comparable to China and Hong Kong, but are much lower than in Australia and New Zealand, where on average each payment card is used more than 100 times a year.

GlobalData Payment Cards Analytics dashboard

In many ways, consumer payment transactions in most Asian markets are still very much cash-based. The densely populated urban nature of markets such as Taiwan, where many merchants are within walking distance and ATMs are available at every corner, provides little incentive for consumers to shift from cash to cards. This is compounded by the fact that many small merchants in Taiwan don’t accept payments cards. These merchants typically compete with other businesses in their vicinity on very low margins, and are therefore extremely sensitive to any increases in their costs.

But Taiwanese consumers have shown a willingness to use their credit or charge cards at POS terminals if there are incentives to do so. Providers should consider discounts, reward programmes and cash-back offers if they want to entice consumers to swap cash for plastic.

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– This article is reproduced with kind permission from GlobalData Financials. Some minor changes have been made to reflect BankNXT style considerations. Read more here. Photo: Phasuthorn Design,

About the author

Arnie Cho

Annie Cho is a senior analyst at GlobalData, specialising in APAC payments and retail banking.

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