Amidst economic headwinds, Asia’s digital economies continue to post impressive gains, with cross-border initiatives and tools offering businesses new avenues to unlock unprecedented growth, according to the latest report by market intelligence firm IDC and commissioned by global payments platform 2C2P and Ant Group.
Since 2021, the IDC InfoBrief commissioned by 2C2P seeks to provide the latest state of play of the digital economy and digital payment landscape within Southeast Asia. This year’s edition, ‘How Asia Buys and Pays 2023: Tapping into Asia’s Regional Commerce Opportunities‘ expands the scope to cover the digital payment landscape across Southeast Asia, South Korea, and Japan (SEAKJ).
The report delves into the vast potential of increased regional connectivity and trade in Asia, driven by projected increases in cross-border e-commerce revenue and offline tourism spending, as well as public and private sector infrastructure.
According to the report, Southeast Asia leads in digital economy growth at 15.8 per cent for the next five years, outpacing both the United States and the EU. South Korea (12.7 per cent) and Japan (10.2 per cent) closely follow, unlocking significant commerce opportunities for SEAKJ.
Southeast Asia also expects a 100 per cent expansion in the e-commerce market, driven by accelerated digital payments growth, led by Buy Now, Pay Later (38 per cent), mobile wallets (18.9 per cent), domestic payments (16.9 per cent) and credit cards (14.4 per cent).
Private and public sector efforts are poised to inject an impressive $232.4billion in fresh cross-border revenue into the SEAKJ economies from 2022 to 2027, driven by e-commerce and tourism spending gains.
Meanwhile, cross-border e-commerce revenue is primed to grow by 70 per cent to $148.1billion by 2027, outpacing the growth of domestic e-commerce revenue.
‘Exciting opportunities’ across Asia
Aung Kyaw Moe, founder and CEO of 2C2P, discussed the report’s findings: “Our mission at 2C2P is to empower businesses to navigate and thrive in the ever-evolving payment landscape in Asia.
“We hope the findings of this report encourage businesses to unlock the immense potential of Asia’s digital economies by tapping into existing public and private sector initiatives and tools. Through our comprehensive payment solutions, we stand ready to partner with businesses to seize the exciting opportunities that lie within and across the region.”
The report also provides a step-by-step guide to how businesses can successfully engage in cross-border commerce by tapping on available cross-border initiatives, ranging from digital payments to logistics, to reach new audiences and create new revenue streams.
Douglas Feagin, senior vice president of Ant Group and head of Alipay+ cross-border mobile payment services, said: “Digitalisation will have a significant positive impact across Asia, shaping the future of businesses and lifestyles. We are committed to helping merchants, both large and small, to benefit from seamless digital payments, which are the foundation of future growth. The rapid rise in the number and diversity of digital payment options does, however, present a challenge, especially for small to mid-sized merchants.
“By working with our partners to enable them to easily accept many different payment options through one easy-to-use interface, we have seen very encouraging results. This has been particularly important with the ongoing increase in online consumption and resumption of cross-border travel. From global online platforms to small street side merchants, it is now imperative for businesses to cater to these digital habits, and I believe that by working together, we can help more consumers and businesses benefit from digitalisation.”