Tuesday Sep 24, 2024
Tuesday Sep 24, 2024
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By Charumini de Silva
As Sri Lanka emerges from its economic downturn, Visa — the global leader in digital payments, is focusing on the country’s potential as a promising hub for digital payments in the Asia Pacific region.
Visa India and South Asia Vice President and Head of Products Ramakrishnan Gopalan recently said that Sri Lanka is poised to join the ranks of rapidly growing economies in the Asia Pacific region, alongside Vietnam and the Philippines.
These emerging markets are expected to drive the next wave of growth in digital payments, cards and contactless instruments.
“The next wave of growth in Asia Pacific in terms of penetration of digital payments, cards and contactless instruments will see a surge in these markets,” said Gopalan.
He noted the significant penetration of debit cards in Sri Lanka and predicted an increase in credit card growth, describing it as an “evolution.”
Gopalan highlighted Sri Lanka’s unique ability for adoption rate of new payment trends. “The spike from single digits to nearly double digits and now galloping double digits is very impressive. It shows that the market is ready for digital payment adoption,” he explained.
Visa Country Manager for Sri Lanka and Maldives Avanthi Colombage said that a significant increase in Visa debit card spending, up over 35% in the past year.
“This growth includes a 30%+ increase in face-to-face spends and over 40% in e-commerce spends, indicating healthy growth in digital payments in Sri Lanka,” she added.
Colombage explained the increase in debit card usage among Sri Lankans mirrors trends in many developing countries, where consumers are opting for seamless and secure card payments over cash.
“Sri Lanka’s economic recovery is strong, with more opportunities for affluent consumption of leisure and holidays, aligned with the Government’s focus on boosting tourism. Low inflation and the rise of multifaceted value-added services for high net worth individuals further enhance the country’s appeal,” Colombage added.
In terms of the outlook for Sri Lanka, Gopalan said it remains positive in terms of consumer spending and digital payment systems.
“The adoption of cashless transactions has dramatically increased across South Asian countries and Sri Lanka clearly is one of the fastest growing markets. We see a newer segment of customers whose payment methods, including debit cards, credit cards and QR payments, differ significantly from previous generations,” he stressed.
He also highlighted the increasing literacy in using multiple payment instruments and the growing popularity of ‘buy now, pay later’ schemes.
“A lot of consumers do not mind using a combination of payments and lending,” he added.
Regarding security features, he said Visa is investing heavily in fraud prevention and enhanced protection for its customer’s transactions spending $ 5-10 billion annually.
“It helps us to stay ahead of the curve,” Gopalan said, adding that banking partners also extend their fullest cooperation.
He also emphasised the need for significant industry investment to support the Government’s digital economy efforts.
“Visa is actively supporting the Government’s digitalisation agenda. Higher rate of digital payments is a sign of formalisation that happens in the market. We are in active discussions with regulators and Government agencies,” Gopalan added.
