April 11, 2023

In recent years, the world has witnessed a dramatic shift toward a cashless economy, with many businesses and consumers preferring the convenience and security of digital payment platforms.
The ripple effect of this global shift was also felt in Fiji in 2018 when the government announced its intention to transition Fiji’s economy to cashless.

The move towards a cashless economy has been accelerated by the COVID-19 pandemic, which has led to an increased demand for contactless payments to minimize the risk of transmission. The pandemic has been the single largest catalyst in the move away from cash. According to an article published by PWC, even merchants that typically see higher levels of cash payments have felt the shift. According to company reports, many merchants have noted a doubling of tap-to-pay transactions in everyday segments such as grocery and pharmacy. To capitalize on these trends, payment processors, merchant acquirers and banks should connect the increasing consumer demand for new payment choices with the growing number of merchants seeking a digital-first approach.

However, whilst the people in Fiji seem to be transitioning from traditional cash system by adopting cashless mediums, some very pertinent systemic issues are actively preventing this – forcing consumers to turn back to the good old ‘green’. These issues, if not addressed will become a thorn and obstacle in transitioning Fiji’s economy to a cashless society; while the rest of the world progresses and modernizes. To contextualize, evidence indicates a growing number of people are using mobile banking services and online banking to transfer funds, make payments and other financial services. There has also been a huge uptake in the use of mobile money services as well as Electronic Fund Transfer at Point of Sales (EFTPOS) services. But here in lies the systemic issues mentioned before – consumers are, in some cases, finding it inconvenient, time consuming and costly to use cashless mediums.

What are these issues?

1. Limited infrastructure and services
   Whilst digital platforms such as EFTPOS and mobile money services are being provided by banks as well as merchants and other businesses, these services are not available or accessible everywhere; forcing consumers to look for ATMs and withdraw cash. For instance, certain businesses do not have EFTPOS for all locally issued cards. The same applies to QR pay; there is a substantial number of businesses which does not offer this service. It is understood that there are other factors at play such as cost to the businesses and arrangements with the financial service provider, however, ways to offer these services must be found

2. Interoperability
   The lack of interoperability amongst service providers such as banks, network providers and businesses also present a significant setback for the cashless transition. Interoperability is generally understood to refer to the ability of different systems and sometimes even different products to seamlessly interact. For payment systems, “interoperability” depends not only on the technical ability of two platforms to interact but also the contractual relationships between the entities wanting to interact. In Fiji, there is a huge gap in terms of interoperability in our financial system. For instance, inability to use a particular bank’s access cards on other banks EFTPOS. The same applies to depositing funds in mobile money platforms; not all banks allow access to do this directly through their online platforms. Hence, some consumers have to withdraw cash, go to an agent and physically deposit in their mobile money wallets.

3. Exorbitant Fees
   Moreover, the exorbitant fees associated with making cashless payments is another barrier that makes consumers think twice about the digital transition. The Council has received several complaints whereby certain businesses are charging a fee for the use of QR pay services. However, the QR service provider (mobile network provider) has stated that there should not be any fees charged for QR pay services. Also, there are also considerable costs involved in making payments digitally, transferring funds and while using other cashless mediums.

4. Time
   Another issue which is evident in our local market is the length of time that it takes to complete a transaction. For instance, transferring funds to family and friends is not instantaneous; especially when they have an account in a different bank. The same applies when making payments for utilities, hire purchase etc. The inconvenience caused betrays the purpose of a cashless transition, making it difficult for consumers to accept the transition fully

5. Limiting transactions
   Inability to transact in low value can be seen as another deterrent factor. Whilst in Fiji there is no such requirement but complaints have revealed that consumers are not allowed to transact in low value using cards in some outlets or by some agents or conditions are placed.
   Therefore, the regulators, policy makers, financial sectors, other industry sectors and businesses
   need to work hand in hand in order to ensure a seamless transition to a cashless society.

Calling on Service Providers and Regulators

Banks, Businesses and Network providers play a crucial role to play in promoting the adoption of a cashless society. They must ensure that their digital payment platforms are user-friendly, secure, and accessible to all customers. Additionally, the Council is ardently advocating for businesses and banks to work together to ensure the interoperability of cashless payment platforms. This means that customers should be able to use their preferred payment system, regardless of the merchant or bank they are transacting with. Interoperability would allow for greater flexibility and convenience for customers, and would also help to reduce the fragmentation of the digital payments market. Whilst incredible work is being done, the Council is still calling on our Central bank to take additional significant steps to ensure that there is a legal and regulatory framework in place to cater to and protect consumers whilst transacting digitally and include the VOICE OF CONSUMERS – the Consumer Council of Fiji in any such developments.

Finally, it is important for all stakeholders to ensure that cashless payment platforms are available to everyone, regardless of their socio-economic status or geographic location. This means that solutions should be developed to address the needs of consumers from all walks of life. It also means that measures should be taken to ensure that digital payments are accessible to those with disabilities or other accessibility needs.

Consumers facing issues while using cashless platforms are encouraged to reach out to the Council via the toll free 155 or lodge a complaint using the Consumer Council of Fiji mobile app