By Lillian Wang, Country Manager, Visa Myanmar
Within less than a decade, Myanmar has emerged from isolation to become one of the new global investment destinations. With a series of economic liberalization policies, a vast majority of young population and growing number of the middle class, the country sees the sustained GDP growth above 6.5 percent in recent years with the forecasted growth at 6.8 percent in 20201.
Despite being one of the most prominent emerging economies in Southeast Asia, around half (52 percent) of Myanmar’s adult population still lack formal access to financial services either through banks or other regulated financial institutions, according to a 2018 financial inclusion survey by the United Nations Capital Development Fund2. In order to help the population gain access to financial services, it is equally important to understand their behaviors, perceptions and attitudes.
With that in mind, we at Visa have been investing in nationwide study called the Visa Consumer Payment Attitudes Survey (the “Study”) since 2017 to understand the consumers better. Our in-depth study examines the perceptions, attitudes and behaviors Myanmar people have towards payment and emerging payment methods. The main goal is to help the financial industry gauge the needs among consumers in order to create products and services that could improve people’s lives. Ultimately, our effort is to contribute to the acceleration of the country’s journey towards a digital economy by linking consumers, businesses, government and financial institutions together.
The latest Visa Consumer Payment Attitudes Survey comprises two components – a quantitative survey to understand financial and payment habits and attitudes, and qualitative interviews to delve deeper into the attitudes of the distinct consumer segments uncovered in the quantitative survey. We deem it useful to share key findings from the Study in hopes that the results will spark a dialogue among stakeholders in the financial industry and the general public on benefits of digital payments and what they can do to help Myanmar reach its full potential.
More Myanmar people are planning to open bank accounts and use cashless payments
According to the Study, 41 percent of respondents said they now own bank accounts, compared to 34 percent from the previous annual survey. Furthermore, 70 percent of those people surveyed who are currently without a bank account plan to open one.
The Study also found a significant increase in use and interest in owning payment cards such as prepaid and credit cards. Currently, 26 percent of people surveyed use or own payment cards, compared to only 3 percent in the previous year. In addition, seven in ten people said they plan to own payment cards compared to less than two in ten people (17 percent) in the previous year.
Key motivators to getting a payment card are “to be in tune with the times” (84 percent) and “to access a simpler form of payment” (63 percent). Respondents also cited that it is safer to carry cards than large amounts of cash and more convenient as they would not have to deal with small change.
More Myanmar people are increasingly trusting banks and going cashless
Attitudes towards banks also continued to improve. Four in five people surveyed (82 percent) agreed that banks are safe and secure, compared to 68 percent from the previous year. A further 77 percent said banks are a convenient way of managing their personal finances.
1Asian Development Bank. Asian Development Outlook 2019 Update. https://www.adb.org/sites/default/files/publication/524596/ado2019-updat.... Accessed January 2020.
2United Nations Capital Development Fund. Making Access Possible Financial Inclusion Diagnostic Myanmar November 2018. http://www.uncdf.org/Download/AdminFileWithFilename?id=8674&cultureId=12.... Accessed January 2020.
Even though Myanmar people rely heavily on cash for daily transaction, one-fourth of the people surveyed (26 percent) have tried going cashless. One of the most exciting findings of the Study is that all of the people surveyed believed Myanmar has the potential to become a cashless society within the next 15 years or less.
Growing awareness and interest in contactless payments technology
One of the most widely used cashless methods in Myanmar is contactless payment cards. These cards enable cardholders to pay for products and services by tapping their cards over payment terminal instead of swiping or inserting their cards, increasing speed and convenience while maintaining the same security as chip cards. This method of payment is gaining ground with Myanmar consumers, where 21 percent of respondents are aware of using them compared to 13 percent in the previous year. Moreover, 48 percent of people surveyed said they’re interested to use contactless payment cards in the future.
The increased interest in contactless payment is also in line with current Visa consumers’ behavior. In September 2018, the number of contactless payments accounted for 20 percent of all face-to-face Visa card transactions, increasing tenfold from just 2 percent in December 2017.
Education holds key to progress
According to the Study, 52 percent of the people surveyed considered themselves slightly knowledgeable in financial matters while only 7 percent of consumers considered themselves experts. This is where we see an opportunity to help Myanmar consumers understand how they can make the most out of financial services available in the market. In 2018, Visa launched the Practical Money Skills financial education website3 in Myanmar language to help people learn about managing personal finances in their everyday lives. Last year, we also held a compliance workshop for banks and government bodies in combating against latest global and regional threats of money laundering and terrorist financing through effective transaction monitoring.
By continuing to share our knowledge with both consumers and industry players, we hope to build the foundation for better collaboration and connect Myanmar to the global economy.
Myanmar’s economic progress lies in everyone working together
We are encouraged to see positive attitudes towards banks and the appetite expressed by Myanmar people to adopt digital forms of payment uncovered in our Study. We are also excited to see growing interest for the adoption of electronic payments as more Myanmar consumers understand the benefits of going cashless.
The higher interest towards using electronic payments can be largely attributed to industry players and the government who have been driving the cashless agenda, as well as merchants around the country who put consumers’ demand at the forefront. As long as we continue to connect and collaborate, to both overcome obstacles and equip consumers with choices and education, the future of Myanmar is poised to be a bright one.
Methodology: The Study was conducted using face-to-face interviews in Myanmar of 504 people across Yangon, Pathein, Mandalay and Magway to understand the financial and payment habits and attitudes of the urban population of Myanmar. Fieldwork for the study was done in September 2018.
Visa Inc. (NYSE: V) is the world’s leader in digital payments. Our mission is to connect the world through the most innovative, reliable and secure payment network - enabling individuals, businesses and economies to thrive. Our advanced global processing network, VisaNet, provides secure and reliable payments around the world, and is capable of handling more than 65,000 transaction messages a second. The company’s relentless focus on innovation is a catalyst for the rapid growth of digital commerce on any device for everyone, everywhere. As the world moves from analog to digital, Visa is applying our brand, products, people, network and scale to reshape the future of commerce. For more information, visit About Visa, visa.com/blog and @VisaNews.