From Octopus to OMO: Hong Kong’s digital payment revolution

Hong Kong has long stood at the forefront of payment innovation. Its early embrace of the Octopus card in 1997 marked a global milestone, introducing one of the first contactless stored-value payment systems. Nearly three decades later, Octopus still holds an impressive 98% penetration rate among residents aged 15 to 64, a testament to the city’s readiness to adopt practical, tech-forward solutions.

However, as consumer preferences and technologies evolve, the city’s payments ecosystem is undergoing a new transformation.

Driven by a highly connected population and solid digital infrastructure, Hong Kong’s e-commerce sector is expanding rapidly, with a projected CAGR of 8.72% between 2024 and 2029. At the same time, mobile wallets are gaining ground, adopted by 88% of local consumers, and placing Hong Kong among the top digital wallet adopters globally.

This shift is fuelled by three key factors.

First, Hong Kong consumers are increasingly looking outward: cross-border e-commerce accounts for 60% of online spending, with Mainland China being the top destination for three-quarters of shoppers.

Second, the rise of omnichannel retail — especially “online-merge-offline” (OMO) — is encouraging merchants to streamline both payment and fulfilment processes.

Third, government-backed initiatives such as the Faster Payment System (FPS) and HKQR are removing friction for businesses and consumers alike, making real-time, interoperable transactions more accessible than ever.

Together, these developments reflect a payments landscape that is dynamic, mobile-first, and increasingly borderless — one that is redefining convenience, connectivity, and consumer experience in Hong Kong.

Market overview of Hong Kong: A financial hub at a payments crossroads

GDP and demographics

A densely populated and internationally connected financial hub, Hong Kong SAR, China has represents a payments market with plenty of opportunity — and quite a few contradictions as well. Its population of 7.54 million skews slightly higher towards females. Approximately 66.8% of the population in Hong Kong is of working age (15 to 64), though an ageing demographic is an increasing challenge in the region.

Hong Kong’s official languages are Chinese and English.

In 2023, Hong Kong’s GDP reached $382 billion, with a per capita GDP of $50,696, placing it relatively high level globally. The e-commerce market has been growing steadily, with 3.5 million e-commerce users in 2023. By 2029, this number is expected to increase to 5.4 million, with a compound annual growth rate (CAGR) of 8.72% from 2024 to 2029 (Statista).

Economic drivers

In 2023, nearly 70% of Hong Kong’s population was aged 15-64, which was also the main consumer group. Services dominate the economy, accounting for 91% of GDP, with tourism making significant contributions.

Unemployment has remained low, except for a spike during the COVID-19 pandemic. The unemployment rate was 2.95% in 2023, which was lower than that of the world's largest economies.

Historically recognised as a global port city, Hong Kong remains a vital international trade hub. In 2023, the SAR’s total imports reached $670.03 billion, ranking ninth globally. Electrical and electronic equipment were the top imported goods, and data from 2023 showed that Mainland China was Hong Kong's largest source of imports and accounted for 45% of total imports.

Consumer and payment trends

Savings account ownership in Hong Kong stands at 64%, while credit card penetration is 72%, ranking second in the Asia-Pacific region.

But a new player is coming into the scene, gradually displacing traditional cashless options such as credit and prepaid cards: Mobile wallets.

A recently published report by Worldpay predicts that digital wallets will become the dominant payment method in Hong Kong by 2030 and will account for half of all online and in-store transactions. One of the driving factors behind this rise is the rising smartphone usage and the integration of payment technologies into Hong Kong consumers’ daily lives. The most widely used digital wallet in Hong Kong is AlipayHK followed by Octopus Wallet, Apple Pay, PayPal, and WeChat Pay HK.

Meanwhile, the Hong Kong SAR’s increased focus on cross-border interoperability and a stronger reliance on mobile wallets are overcoming even the most stubborn shopping habits and broadening opportunities for both shoppers and merchants.

Consumer trends: The rise of OMO and the digitally empowered shopper

Post-pandemic recovery, the rise of the online-merge-offline (OMO) model, and high levels of digital engagement are reshaping consumer expectations in Hong Kong. Today's consumers value greater ease and interactivity, while tourist consumption patterns have shifted away from shopping to experiential tourism, which demands that traditional retail models struggle to meet.

To stay competitive, merchants must adapt their strategies — blending physical and digital channels, streamlining payment and fulfilment, and delivering seamless, experience-driven customer journeys.

Let’s set the stage: the Hong Kong SAR Government’s 2024 Mid-Year Economic Report found that the region's economy saw moderate growth in H1 2024, with real GDP increasing by 3.3% year-over-year in Q2.

Based on the latest available data from the Hong Kong Census and Statistics Department, in 2021, the median annual household income was HKD 332,000, primarily from occupational incomes. Additional cash income sources included rental earnings, dividends, interest, pensions, welfare benefits, government subsidies, and regular remittances from non-family members.

In 2020, average household expenditure was HKD 363,000, with housing costs accounting for 39.3% of total spending. Notably, average household spending exceeds median household income due to income inequality, as high-spending wealthy households have raised the overall expenditure average in Hong Kong.

Physical retail

Retail is one of Hong Kong SAR's most important pillar industries. Like other sectors affected by COVID-19, Hong Kong's retail market is gradually recovering but still faces significant internal and external challenges.

Tourist spending was once a crucial pillar of Hong Kong's retail sector, accounting for 30% to 40%, but in 2023, it only contributed 18% due to a significant decrease in visitor arrivals. Moreover, post-COVID-19 visitors' consumption patterns have fundamentally shifted from primarily shopping to in-depth experiential tourism focusing on ecological sightseeing, cultural appreciation, and leisure activities, resulting in the slower-than-expected recovery of tourist spending.

The Central and SAR governments have actively implemented measures to boost tourism recovery, such as increasing duty-free shopping quotas for mainland visitors. These measures have shown results, with visitor arrivals reaching 3.39 million in April 2024, up 17.3% year-on-year.

According to Statista, Hong Kong's retail market sales in 2023 grew significantly by 16.2% year-on-year, reaching HKD 406.7 billion.

E-commerce

Hong Kong is one of the earliest cities in Asia to develop e-commerce. Besides its highly developed internet infrastructure, residents living in highly connected urban areas have enabled e-commerce to flourish.

To meet consumer demands for better shopping experiences and enhance competitiveness, many merchants have adopted an OMO model. This allows consumers to access detailed product information and place orders online, then try products in physical stores before pickup or returns — essentially an “order online, pickup in-store” shopping model.

More importantly, this model helps sellers closely track customer behaviour and build customer loyalty. With technological advancement and increased government support, the OMO model could become a “blue ocean” opportunity for brands looking to differentiate their offerings and deepen customer relationships.

In 2023, Hong Kong had approximately 3.5 million e-commerce users, with a penetration rate of 48.7%. By 2029, the number of users is expected to reach 5.4 million, with e-commerce user penetration exceeding 73.1%.

Hong Kong's e-commerce market revenue is projected to reach $4.37 billion in 2023 and is expected to grow to $5.35 billion by 2025. The average e-commerce spending per user is expected to reach $1,264 by 2025.

These figures reveal Hong Kong's substantial e-commerce market potential. Let's analyse the characteristics of local e-commerce users through some data.

91.2% of Hong Kong's online shoppers are young and middle-aged people under 54, with female shoppers slightly outnumbering males. About 60% of e-commerce access is through laptops, with the remainder using smartphones.

According to a 2022 survey in Hong Kong, 28% of respondents shop online multiple times monthly, and 42% reported increased online shopping frequency compared to 2021.

How actively are Hong Kong residents engaging with e-commerce? In 2023, approximately 51.8% of respondents reported purchasing products or services during their weekly e-commerce activities.

Convenience, cost effectiveness, and positive shopping experiences are the three main factors driving Hong Kong consumers to continue online shopping. Additionally, 45% prefer “order online, pickup in-store” service, and 42% believe improving self-checkout experience is key to enhancing shopping satisfaction.

A 2022 consumer online shopping survey by Hong Kong Shue Yan University showed that nearly 80% of respondents consider shipping fees a primary factor in their decision process, with over half willing to pay no more than 10% of the product price for shipping.

In comparison, the "order online, pickup in-store" model is popular among Hong Kong consumers as it eliminates shipping fees while offering flexible timing and in-store experience to boost purchase confidence.

Hong Kong consumers most frequently purchase clothing, footwear, cosmetics, and skincare products online. Furthermore, 46% find shopping reviews very helpful, 44% research online before making major purchases, and 31% regularly manage recurring orders through electronic devices.

The data demonstrates that, clearly, online shopping has become second nature for many in Hong Kong. The next question is: how far does this digital shift extend?

Digital behaviours

According to Statista, Hong Kong had 7.17 million internet users in 2023, with a penetration rate of approximately 95.6%. Mobile internet penetration has increased yearly to 91.64%, with mobile internet users exceeding 6.96 million.

These high numbers, when paired with the evolving online shopping behaviour portrayed in the previous section, paint a compelling picture of online behaviour driving consumption.

In the third quarter of 2023, Hong Kong internet users spent an average of 699 minutes daily online, with significant time spent on social networks.

With digital engagement so widespread, what’s the level of adoption for digital payments in Hong Kong?

In 2023, Hong Kong's digital payment penetration rate reached 66.21%, with digital payment transaction value exceeding $35.77 billion. These figures demonstrate local residents' high acceptance of digital payments. A 2022 survey showed that Hong Kong consumers primarily use digital payments for online shopping, bill payments, and in-store purchases.

The state of payments in Hong Kong: Building the future on familiar foundations

As a mature and dynamic economy, Hong Kong's digital payment market is growing rapidly. Hong Kong's digital payment user base has been consistently growing and is expected to reach 6.37 million by 2025. Digital payment transaction value will exceed $46.04 billion, with a projected CAGR of 8.46% between 2024 and 2028.

Study the landscape more closely, and a more nuanced picture emerges. While convenience and speed are the top reasons behind the shift to digital payments, their ability to support seamless cross-border transactions has also made them increasingly attractive.

That said, traditional cashless methods have not disappeared. Credit cards, for instance, remain a key player in the digital economy and continue to dominate Hong Kong’s e-commerce space as the top payment method in the territory (see graph below).

Meanwhile, the Octopus card, long a staple in the city’s payment ecosystem, retains its relevance, and recent policy updates and enhancements are helping it stay competitive against rising players like AlipayHK and other mobile wallets.

Together, these developments signal that while digital payments are gaining ground, Hong Kong’s payment landscape is characterised not by replacement, but by layered adoption, where legacy systems, credit-based tools, and next-generation digital wallets coexist and evolve in response to changing consumer needs.

Let's examine the details of each payment method in Hong Kong, including cards, digital wallets, and bank transfers, along with the role they have to play in this evolving payments landscape.

Credit and debit cards

Hong Kong has a mature and diverse card payment market, with residents holding an average of 3.4 cards per person, and credit card transaction volume significantly exceeds debit card usage. In 2022, Hong Kong residents used credit cards more than 143 times per person on average.

The card brands in Hong Kong are dominated by local brands such as (China) UnionPay International and EPS, followed by Visa, Mastercard, and American Express.

As shown in the figure below, in 2023, credit card transaction value in Hong Kong exceeded HKD 920.7 billion, while debit card transactions reached HKD 288.6 billion.

Digital wallets

Hong Kong's digital wallet usage is showing robust growth. Thanks to policy support, infrastructure advantages, and diverse payment scenarios, digital wallets have become one of Hong Kong's mainstream payment methods with continued growth potential.

For example: the Hong Kong Monetary Authority has further promoted digital payments by introducing the unified QR code payment standard (HKQR) and Faster Payment System (FPS). HKQR simplifies merchant payment processes by eliminating the need for multiple QR codes, while FPS supports 36 banks and 10 payment service providers, enabling real-time transfers and merchant payments.

Hong Kong consumers have responded positively to these moves. According to Statista data, a 2023 digital wallet usage survey showed that 87.9% of local respondents used digital wallets in the past year, ranking fourth globally.

Among popular digital wallet brands, AlipayHK has 4.5 million active users, making it one of the most popular digital wallets in Hong Kong, with over 170,000 online and offline merchants accepting AlipayHK payments. For local residents, AlipayHK covers their payment needs across various aspects of daily life.

Antom can help merchants integrate AlipayHK in Hong Kong: providing seamless onboarding, technical support, and access to Hong Kong’s growing consumer base through one of the city's most widely used digital wallets.

Bank transfers

As one of the world's leading financial centres, Hong Kong's banking sector is a major contributor to the financial industry's added value, employing over 100,000 people. Major banks like Hang Seng Bank originated in Hong Kong; many foreign and mainland Chinese banks have subsidiaries in Hong Kong.

Driven by technological advancement, regulatory reform, and changing consumer preferences, Hong Kong's digital banking sector is vibrant and rapidly developing. In 2019, the Hong Kong Monetary Authority (HKMA) introduced a new regulatory framework to encourage digital banking development and promote competition and innovation in the financial sector.

By 2023, Hong Kong's digital bank deposits reached $176.2 billion, with net interest income of $28.96 billion.

Octopus card

Octopus card: Introduced by the Hong Kong SAR government in 1997, the Octopus card is Hong Kong's most widespread prepaid payment tool. Initially designed for public transport payments, it has evolved into a multifunctional payment system supporting small retail purchases and personal identification.

Currently, 98% of Hong Kong's population aged 15-64 owns an Octopus card. Although Octopus has quickly adapted to digitalisation with contactless mobile applications and dedicated digital wallets, other digital wallet brands like AlipayHK continue to expand their market share.

Seizing opportunities in Hong Kong’s evolving payments space

Hong Kong’s payments landscape stands out in the Asia-Pacific region for its unique blend of global orientation, digital maturity, and layered adoption of payment technologies.

A longstanding gateway for international trade and travel, Hong Kong has developed a payments ecosystem that caters not only to local consumers but also to a high volume of cross-border transactions. As digital payment adoption accelerates, merchants must act early to implement suitable payment solutions that tap into Hong Kong’s robust infrastructure and logistics capabilities, while supporting the growing trend of cross-border consumer activity.

Tradition still holds sway in Hong Kong payments: credit cards remain the most widely used payment method for online shopping. However, digital wallets have rapidly gained traction, with 88% of consumers using them in 2023. AlipayHK stands out from these options, with 4.5 million active users and widespread acceptance across more than 170,000 merchants.

Looking ahead, the growing popularity of digital wallets, digital banking, and even emerging technologies like cryptocurrencies signals a continued shift away from traditional cashless methods such as credit and debit cards. Reliance on prepaid cards, debit cards, and cash-on-delivery options is on the decline in Hong Kong — a trend that bears watching.

Merchants with strong digital integration, cross-border readiness, and a customer-first payment experience will be best positioned to thrive in Hong Kong’s dynamic payments environment.

How Antom can help you with payments in Hong Kong SAR

Antom can help merchants tap into Hong Kong’s fast-evolving payments ecosystem with seamless, scalable solutions tailored to local and cross-border needs. Whether you’re looking to connect with millions of digital wallet users or simplify cross-border transactions, Antom provides the tools and infrastructure to meet your goals.

1. Digital wallet payment solutions

Antom supports merchant integration with AlipayHK. As one of the most popular digital wallets in the region, AlipayHK boasts 4.5 million active users and over 170,000 merchants, covering all daily needs and activities.

2. Integration with major card payment networks

Antom provides merchants with access to the most widely used card payment solutions in Hong Kong SAR. As one of the most popular payment methods in Hong Kong, card payments hold a big share of the local payment market, making them essential for businesses looking to reach a broad customer base.

3. One-Stop cross-border payment services

Antom offers merchants easy access to over 300 global payment methods through a comprehensive integration solution. As a key gateway in Southeast Asia, Hong Kong attracts many businesspeople and tourists from Mainland China, Japan, and South Korea, while maintaining strong commercial ties with neighbouring countries.

Merchants can choose cross-border payment solutions that meet the diverse needs of local residents and international visitors.