Mobile payments in Asia on the rise

As consumers seek faster and more convenient ways to shop, mobile payments have risen and companies are developing security measures to tempt customers.

Apple's Touch ID, exclusive to its iPhone 5s, lets users make purchases from its App Store using a fingerprint.

More recently, e-commerce giant PayPal took it a step further, teaming up with Samsung to offer fingerprint authentication for online purchases, using the South Korean company's Galaxy S5 smartphones. It means that S5 users can authenticate transactions or transfer money through PayPal with the swipe of a finger - no username or password needed.

Experts calculate that more than a third of global business-to-consumer e-commerce sales comes from the Asia-Pacific region.

Asian consumers are expected to spend twice as much as consumers in the United States by next year in general transactions.

Singapore's e-commerce market is expected to be worth $4.4 billion by next year. It has more than half a million active PayPal accounts. But only 31 per cent of consumers here are interested in using mobile payments, which is among the lowest proportion in Asia.

A study by First Data, a global payment processing company, found that 89 per cent of consumers here use smartphones and 60 per cent of the people surveyed were aware of mobile wallets.

But only 19 per cent thought it safe to make payment by mobile phone, compared with 56 per cent in China and 49 per cent in India.

Senior vice president and head of First Data Asia Pacific, Mr Marc Mathenz, thinks that consumers here are "technologically and digitally savvy", but cautious about the security of payments and personal data.

Education will play a big role in alleviating concerns about personal data and payment security, he said.

Being cautious may be the smart way to approach mobile payments. Researchers from German-based Security Research Labs have cracked the iPhone 5s' Touch ID and Galaxy S5's biometric security by fooling their fingerprint sensors.

When asked to comment, a PayPal spokesman said: "While we take the findings from Security Research Labs very seriously, we are still confident that fingerprint authentication offers an easier and more secure way to pay on mobile devices than passwords and PINs."

PayPal explained that it does not have access to a user's actual fingerprints. It said the scan unlocks a secure cryptographic key which serves as a password replacement for the phone and can be deactivated remotely if a device is lost or stolen.

If fraud is involved, PayPal said, customers' eligible transactions are covered by a buyer-protection policy.

colintan@sph.com.sg

This article was published on April 23 in Digital Life, The Straits Times.

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