Card usage dips as nation mourns King
Visa expects to see spending growth curtailed this fiscal year as consumers have been reluctant to open their wallets during the mourning period that followed the late King's passing in October.
Yet it expects a boost will come from the installation of more card-swiping terminals under the national e-payment plan.
Spending on Visa cards issued in Thailand rose 6.7% from October through March, down from 7% growth recorded in the same period one year earlier, said Visa country manager Suripong Tantiyanon.
He said this was due to a slowdown in spending in the last three months of 2016 as consumers were more hesitant to spend, while banks and retailers also stopped offering promotions and marketing campaigns during this sensitive period.
"In this fiscal year, we expect growth will only be 2-3 percentage points higher than the 6.7% growth recorded in the first two quarters of fiscal year 2017," Mr Suripong said.
Double-digit growth would be hard to achieve under the current climate, he added.
Spending on locally issued Visa cards jumped 11.5% in fiscal 2015, which ended on Sept 30, compared with a smaller burst of 9.6% growth in the previous fiscal year.
While that growth has decelerated in the last two years, spending on Visa Debit cards posted healthy gains of 13.7% in the first six months of fiscal 2017, records show.
In the same period, e-commerce spending grew steadily at 22% while inbound payments were up just 4% due to the cancellation of trips during the official mourning period for the late monarch, Mr Suripong said.
He said the government's plan to install a further 560,000 electronic data capture (EDC) terminals by next March should help boost spending on both credit and debit cards in the next few years.
The decision to double the number of card terminals at 7-Eleven convenience stores to 10,000 by the end of the year will also support growth in card spending, he added.
Bank of Thailand figures show there are around 70 million credit and debit cards circulating in the Thai market. Mr Suripong said about 50 million of these now bear the Visa logo.
A report on Southeast Asia called the "Visa Consumer Payment Attitudes Study 2016" found that 59% of Thai consumers who responded preferred electronic payments over cash, up from 52% recorded in 2015.
The study surveyed 3,000 consumers in six countries including 500 Thais with a monthly personal income of at least 15,000 baht.
Respondents, who were able to give more than one answer, said Thais tend to carry less cash because they find it is not safe (60%), ATMs are easy to access (48%) and they prefer contactless forms of payment (36%).
As more innovations emerge, consumers seem willing to try new payment technologies as seven in 10 Thais (67%) prefer automated payments, the study showed.
"The unprecedented growth of the on-demand economy, particularly in ride-sharing apps, creates new demand for fast, secure and convenient card-not-present payments," Mr Suripong said.
Prime Minister Prayut Chan-o-cha said this week he expects economic growth to hit 3.3%-3.8% this year.