In a media roundtable held on October 30, United Overseas Bank (UOB) revealed a promising outlook for travel spending among ASEAN countries in fiscal year 2024. The forecast indicates a remarkable increase of 126% compared to 2019 levels and a 17% rise compared to 2023.
According to data drawn from Visa and Mastercard consumer credit card transactions, total billings in the first half of 2024 across Singapore, Malaysia, Thailand, Indonesia, and Vietnam experienced an 11% year-on-year increase. This growth is largely attributed to the sectors of dining, e-commerce, and entertainment, which recorded impressive increases in card billings of 21%, 20%, and 19%, respectively.
Singapore stood out within the ASEAN region, showcasing a 15% growth in card billings year-on-year. This growth was fueled by a significant 23% increase in dining-related card billings and a 21% rise in e-commerce spending. Additionally, travel expenditures saw a 17% year-on-year growth.
The report identified the top travel destinations by foreign currency spending for FY2024, with Europe, Japan, the United States, Singapore, Malaysia, and the United Kingdom leading the list.
UOB also highlighted notable differences in consumer spending patterns between credit and debit card usage across ASEAN. The Mastercard cross-border card present data for the first half of 2024 revealed that the leading categories for credit card expenditures included hotels and lodgings, apparel, bars and restaurants, department stores, watches and jewelry, and duty-free shops. Conversely, debit card spending was primarily focused on apparel, bars and restaurants, hotels and lodgings, department stores, and grocery stores.
In Singapore, UOB customers exhibited a greater propensity to spend on accommodation and shopping compared to the overall market. Specifically, UOB’s customer base allocated 29% of their spending to accommodation and 19% to apparel, surpassing the market averages of 24% and 16%, respectively.
The bank also observed a trend toward increased bookings through online travel agencies, although direct bookings remained the preferred choice. In Singapore, there was a striking 43% year-on-year increase in flight and hotel bookings via online travel agencies, alongside a 16% year-on-year rise in direct bookings.
Credit and debit cards emerged as the preferred payment methods for overseas spending, with 57% of Singaporeans opting for cards compared to just 46% who preferred cash. This trend is evident in the 17% year-on-year growth in cross-border credit and debit card billings reported as of August 2024.
Furthermore, UOB’s findings indicated significant variations in card usage preferences among different demographics. Notably, over half of Gen Z customers (55%) utilized debit cards for overseas transactions, in stark contrast to less than 20% of customers from older age groups. Additionally, average overseas billing on credit cards was approximately double that of debit cards, with female customers spending about 20% less than their male counterparts while traveling abroad.
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