Local conglomerates perceive the electronic payment business as a way to lower cash-processing costs and — in time — increase customer loyalty.
“The electronic payment sector is still very new in Taiwan, with 70 to 80 percent of the nation’s purchases still made with cash,” Yuan Hsin Digital Payment Co (遠鑫電子票證) president Maria Liang (梁曉雯) said.
Last month, Yuan Hsin, a subsidiary of Far Eastern Group (遠東集團), launched the HappyCash card, allowing cardholders to store up to NT$10,000 (US$328) for use in the group’s seven retail chains: Far Eastern Department Stores Co (遠東百貨), Pacific Sogo Department Stores Co (太平洋崇光百貨), Far EasTone Telecommunications Co (遠傳電信), Far Eastern A-Mart Co (遠東愛買), City Super supermarket, Taipei Metro’s The Mall (遠企購物中心) and the Hsinchu outlet of Pacific Sogo’s Big City (遠東巨城購物中心).
Liang said the new card would help lower cash-processing costs and engage cardholders with a bonus collection program to boost the group’s retail sales.
The group’s existing Happy Go (快樂購) card system has 12 million members and Yuan Hsin hopes the new HappyCash card will attract more members, as it provides stronger protection against card losses, Liang said.
The company plans to further expand the card’s use to other convenience store operators, such as Taiwan FamilyMart Co (全家便利商店), Hi-Life International Co (萊爾富國際) and OK Mart Co (來來超商), by the end of this year, she added.
Uni-President Group’s (統一集團) President Chain Store Corp (統一超商) has recently upgraded its iCash card business by launching a unit — iCash Corp (愛金卡) — to handle sales for its second-generation iCash card and expand its use.
The operator of the nation’s largest convenience store chain is set to expand the use of the card from 7-Eleven stores to other PCSC retail channels, including drugstore chain Cosmed (康是美) and President Starbucks Coffee Corp (統一星巴克), by the end of this year, company general manager Winnie Liang (梁玉璘) said.
For HappyCash and iCash, higher card sales bring in increased transaction fees and therefore better profitability.
As a result, eyeing the potential consumption scale of NT$230 billion annually in the domestic e-payment sector, Yuan Hsin and President Chain hold high expectations for the development of small payments in the transportation sector, the companies said.
In other words, they want to become another option consumers can use to take the rapid transit systems in Taipei and Greater Kaohsiung, distinct from Easycard Corp (悠遊卡) or iPass Corp (一卡通票證).
However, that potential move would need strong backend support, government approval and the public’s trust, the two companies said.
As of the end of August, the nation has three companies specializing in electronic payments, with four banks entering the sector, according to data compiled by the Financial Supervisory Commission.
The total number of electronic payment cards and tickets issued totaled 55.26 million, with their monthly consumption standing above NT$4.8 billion, statistics show.
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