As governments encourage people to stay at home to slow the spread of Covid-19, Southeast Asia has seen the rapid adoption of digital services such as e-commerce, food delivery and online payment methods.

And that trend is likely to continue. The report, which surveyed more than 16,000 people in Indonesia, Malaysia, the Philippines, Singapore, Thailand and Vietnam, predicts that the number of consumers using digital services in Southeast Asia will reach 350 million by the end of this year.

By the end of 2021, Facebook and Bain project that more than 70% of people aged 15 and over in the countries surveyed will be shopping online. The report also predicts that the number of online shoppers in Southeast Asia will reach 380 million by 2026.

Among the countries surveyed, the report said Indonesia, Southeast Asia’s largest economy, continued to have the highest growth rates. The country’s population of consumers of digital services is projected to grow by about 15%, from 144 million in 2020 to 165 million in 2021.

The explosion of E-commerce

Many parts of Southeast Asia are grappling with developments complicated by a highly transmissible variant of Covid-19. Vaccination rates remain low in some emerging economies. Continuous distancing measures and restrictions on movement make it difficult for consumers to access brick-and-mortar stores, leading many e-commerce markets to flourish.

The proportion of survey respondents who said they have primarily shopped online has increased from 33% in 2020 to 45% this year, with the largest increases coming from Singapore, Malaysia and the Philippines.

Average spending on online services is also predicted to grow 60% this year from $238 per person in 2020 to $381. The share of online retail compared to overall retail activity in Southeast Asia has increased from 5% in 2020 to 9%, with a faster growth rate in Brazil, China or India.

“Over the next five years, Southeast Asia’s e-commerce sales are also predicted to be matched with these countries, growing at 14 percent annually,” the report said.

Capital flows into Fintech

With more purchases being made online, fintech services like “buy now, pay later,” or e-wallets and cryptocurrencies are also becoming more popular.

In the first three months of the year, 88% of private investment and venture capital in the region flowed into the technology and Internet sectors. Of that, 56% of this capital has gone into fintech, according to the report.

“We are looking at a triple boom in the fintech sector. As lawmakers lift capital barriers, we should see a “river” of capital rumbling into the sector, says Dmitry Levit of Cento Ventures.

E-wallets are the preferred payment option for 37% of survey respondents, compared with 28% preferring cash, 19% for credit or debit cards, and 15% in favor of bank transfers. The Philippines, Malaysia, and Vietnam saw the biggest increases in e-wallet adoption, with growth in these three markets of 133 percent, 87%, and 82%, respectively.

Southeast Asia’s rapid digitization during the pandemic presents enormous opportunities in the region’s digital economy.

“Southeast Asia will be a bull market for at least the next 10 years as new industries and products emerge,” said Justin Hall, partner at Golden Gate Ventures.

Source: vneconomy.vn