'Cities are the new engines of economic growth. To unlock their true economic potential, and become globally competitive, cities must embrace digital payments'
According to a new study, conducted by economics research firm Roubini ThoughtLab and commissioned by US multinational global payments technology company Visa, increasing the use of digital payment facilities in 100 cities that include Dhaka could save $470 billion annually across all of them.
The findings of the study, titled “Cashless Cities: Realising the Benefits of Digital Payments,” were announced through a Visa press release issued on Thursday.
“Consumers across the 100 cities could achieve nearly US$28 billion per year in estimated direct net benefits. This impact would be derived from factors including up to 3.2 billion hours in time savings conducting banking, retail and transit transactions, in addition to a reduction in cash-related crime,” the press release read.
The press release further said that businesses across the 100 cities could achieve even higher direct benefits, amounting to $312 billion per year. This includes $3.1 billion hours in time savings when processing incoming and outgoing payments.
“Governments across the 100 cities could achieve nearly US$130 billion per year in estimated direct benefits. This impact would be derived from factors including increased tax revenues, increased economic growth, cost savings from administrative efficiencies and lower criminal justice costs due to reduced cash-related crime,” it added.
The study was conducted by surveying 3000 consumers and 900 businesses across Tokyo, Chicago, Stockholm, Sao Paolo, Bangkok and Lagos. Each of the cities were taken to represent different levels of digital payment maturity, and the data was then extrapolated to include 94 cities around the world.
“Cities are the new engines of economic growth. To unlock their true economic potential, and become globally competitive, cities must embrace digital payments,” Visa Group Country Manager (India and South Asia) TR Ramachandran was quoted as saying in the statement.
“Dhaka could achieve, on average, US$1.5 billion in annual net benefits – roughly the equivalent to 3 percent of the city’s average GDP,” he added.
Meanwhile, Lou Celi, head of Roubini ThoughtLab, said in the statement: “The use of digital technologies – from smart phones and wearables to artificial intelligence and driverless cars – is rapidly transforming how city dwellers shop, travel, and live. Without a firm foundation in electronic payments, cities will not be able to fully capture their digital future, according to our analysis.”