Just half a decade ago in Malaysia, businessmen would have to go through a scheduled appointment with travel agents to book a flight or fashion-conscious teens would need to head over to a retail store to score some trendy accessories.
Today, all they need is a credit card, a PC (or even a smartphone), and an Internet connection.
Allowing for convenient shopping
The concept of online ecommerce and spending over the internet through credit cards are still fairly new for Malaysians, but they catch on quickly.
With more and more options opening the way to their first online purchase as more retail stores in more industries start adopting online payment schemes, Malaysians are steadily embracing the online credit card spending revolution.
Nearly half of everyone who owns a credit card in Malaysia – 43 per cent – have bought something with it through their PCs. It’s not just credit cards either: two per cent of people who own debit cards have used them to buy something via their smartphones.
Travel, deals, and fashion
Out of all the Malaysian credit card owners who purchase online, a majority spent money on travel and flights and daily deals, and nearly half spent money on fashion. Clearly, people use their credit cards on more than one industry, and these five saw double digit percentage spending:
Travel and flights – 68 per cent
Daily deals – 56 per cent
Fashion – 42 per cent
Tech and gadgets – 37 per cent
Groceries – 19 per cent
The steady increase in online credit card spending doesn’t mean people are more adroit at repayments, however, as the majority of Malaysian credit card holders continue to repay only the bare minimum of their credit card bills every month.
Several factors lead to the increase in online spending
If you take a look at the top areas of spending listed above, it’s easy to see that ease and convenience was a big factor in the purchase decisions of Malaysian credit card holders. Why go through travel agents when you can book trips online? Should you head over your favourite retail store when you can see their product offerings online?
Another important factor is the opportunity to save money. The second highest on the list was daily deals – basically bundles of products meant to help people save money. Indeed, many websites and businesses that engage in ecommerce take great pains to ensure that in one way or other, buying online through them would be cheaper. The mere fact that people don’t have to spend on petrol or public transport to go to a physical store already saves them money.
Finally, the ubiquity of the mobile devices people can use is also greasing the wheels for the online credit card spending revolution in Malaysia. While desktop PCs are still the leading gateways to online spending, it’s easy to see how the proliferation of tablets and smartphones encourage not personal and mobile online spending.
With the Malaysian market growing by the day, we will be seeing increased spending online. The question is, will the high debt of Malaysians hinder these numbers in the future.
CompareHero is the leading Malaysian financial comparison platform, aimed at educating Malaysians and help them save time and money.
For more ways to save money and a complete overview of comparisons from mobile and broadband products to financial products, visit www.comparehero.my.