MANILA, Philippines–Digital banking continues to gain significant ground in Asia, where nearly 700 million consumers were found to be using this platform regularly, given the rapid increase in Internet and smartphone adoption.
In a report entitled “Digital Banking in Asia: What do consumers really want?” multinational management consulting firm McKinsey and Co. pointed out that in developed Asian markets, Internet banking was nearly universal and smartphone banking had grown more than threefold since 2011.
In emerging Asian markets such as the Philippines, the trend was similarly dynamic, with about a quarter of consumers using computers and smartphones for their banking needs.
“The rise of digital banking in Asia has been anticipated for many years, but several factors have combined recently to accelerate this trend. Among the most important changes is the presence of a much stronger ecosystem to enable digital banking, which includes the rapid increase in Internet and smartphone adoption and growth in e-commerce, resulting in the demand for digital banking moving from early adopters to a broad range of customers,” said the report’s co-authors Sonia Barquin and Vinayak HV.
For this report, McKinsey conducted a survey from July to September 2014, during which the group polled about 16,000 financial consumers across 13 markets in Asia—including the Philippines—regarding their banking habits.
Developed Asia comprised six economies namely Australia (where 700 respondents were polled); Hong Kong (750 respondents); Japan (750 respondents); Singapore (750 respondents); South Korea (750 respondents); and Taiwan (800 respondents).
Emerging Asia, meanwhile, was composed of China (3,500 respondents); India (4,000 respondents); Indonesia (1,100 respondents); Malaysia (700 respondents); the Philippines (700 respondents); Thailand (750 respondents); and Vietnam (700 respondents).
Of the markets reviewed by McKinsey, the Philippines had the lowest digital banking penetration at only 13 percent in 2014. In contrast, South Korea and Australia posted the highest penetration at 96 percent, followed by Singapore at 94 percent, Hong Kong at 93 percent and Taiwan at 83 percent.