The Hong Kong card payments market is forecast to grow by 12.2% to reach HKD1.3 trillion ($168.1 billion) in 2024, supported by a constant consumer shift towards non-cash payments, according to GlobalData, a leading data and analytics company.

GlobalData’s Payment Cards Analytics reveals that Hong Kong saw a slower growth of 3.2% in card payments value in 2022, as soaring inflation, rising unemployment, and geopolitical uncertainty affected consumer spending, which in turn impacted card payments. However, with the Hong Kong economy registering a positive real GDP growth of 3.3% in 2023 after a decline of 3.5% in 2022, the country’s card market revived to witness 15.7% growth in 2023, reaching HK$1.2 trillion ($149.9 billion).

Shivani Gupta, Senior Banking and Payments Analyst at GlobalData, comments: “Although cash remains the favored payment method in Hong Kong, the uptake of electronic payment methods is on the rise. Consumers are increasingly adopting payment cards, spurred by a strong banked population and the expansion of payment acceptance infrastructure. This shift in consumer behavior signals a move away from conventional payment method like cash to embrace digital alternatives.”

A well-developed payment infrastructure has supported the overall card payments growth in Hong Kong, with POS terminal penetration per 1 million individuals standing at 26,579 in 2023, which is higher than peer countries including Malaysia (26,228), China (25,513), Japan (20,867), and Thailand (16,358).

Gupta adds: “The growth of card payments has also been supported by the high adoption and usage of contactless cards, driven by increased awareness of contactless cards among consumers and merchants in Hong Kong. Consumers and financial institutions alike have embraced the technology, with widespread acceptance infrastructure being the major reason why the cards are popular.”

According to GlobalData’s 2023 Financial Services Consumer Survey*, over 66% of the respondents in Hong Kong indicated having access to a contactless card and used it for payments. The rising usage of contactless payments for public transport payments is also contributing to this. Effective from December 2023, Visa contactless payment cards are accepted at entrance and exit gates for fare payments on Hong Kong’s Mass Transit Railway (MTR) system.

Among the card types, credit and charge cards accounted for 75.4% share of the overall card payment value in 2023. This is mainly due to the value-added benefits associated with these cards, such as flexible payment options and reward programs.

Debit cards, on the other hand, account for the remaining 24.6% share. Although debit cards are traditionally preferred for cash withdrawals, they are now increasingly being used for payments as well, especially low-to-medium value transactions.

Shivani concludes: “Hong Kong’s payment card market is expected to continue its upward growth trajectory, supported by widespread payment infrastructure and the increased convenience of contactless technology. The market is expected to grow at a CAGR of 8.7% between 2024 and 2028 to reach HKD1.8 trillion ($234.3 billion) in 2028.”

*GlobalData’s 2023 Financial Services Consumer Survey was carried out in Q2 2023. Approximately 50,000 respondents aged 18+ were surveyed across 40 countries.