As Taiwan continues to innovate in the digital economy, its payment landscape has evolved to include a diverse range of options. From traditional cash transactions to modern digital wallets and systemically important financial infrastructure, Taiwan offers consumers a variety of ways to pay for goods and services. Whether you’re a local resident or a visitor, understanding Taiwan’s payment methods will help you navigate this dynamic environment.
- Cash Payments: Still Prevalent
Despite the global trend toward cashless payments, cash remains a popular method of payment in Taiwan, especially for smaller, everyday purchases. Taiwan’s currency is the New Taiwan Dollar (NTD), and cash transactions typically involve coins in denominations of NTD $1, $5, $10, and $50, as well as banknotes from NTD $100 to $2,000.
Where is it commonly used?
- Night markets
- Small, local businesses
- Public transportation for non-digital ticketing
- Credit Cards: Widespread Acceptance
Credit cards are widely accepted in Taiwan, particularly in major urban areas and for larger transactions. Many merchants in retail stores, hotels, and restaurants accept international credit cards such as Visa, Mastercard, and JCB. Taiwan’s local banks also issue co-branded cards, and credit cards are increasingly used for both in-person and online purchases.
Popular Cards in Taiwan:
- Visa
- Mastercard
- JCB (popular among tourists, especially from Japan)
- IC Cards: Convenience for Transportation and Shopping
Taiwan has made substantial progress in prepaid cards known as IC cards. These contactless cards, such as EasyCard, iPass, and iCash, are highly popular for both public transportation and small retail purchases.
EasyCard is the most widely used for MRT (Taipei’s subway system), buses, and even bike rentals like YouBike. Similarly, iPass operates in the southern regions of Taiwan. Both cards can be topped up at convenience stores like 7-Eleven and FamilyMart, and are also accepted at a range of retailers.
Best for:
- Tourists and locals for public transport
- Quick, small payments in convenience stores
- Mobile Wallets: Growing Popularity
In recent years, mobile wallets have gained popularity, driven by the convenience of smartphone-based payments. Taiwan’s mobile wallet ecosystem includes both global and local options.
Popular Mobile Wallets:
- Apple Pay and Google Pay: Internationally recognized, these wallets are increasingly accepted in Taiwan, especially in retail stores and larger chain establishments.
- JKoPay: A local mobile wallet that has been adopted widely for use in small businesses, retail stores, and even street vendors.
Key Advantages:
- Secure, contactless payments.
- Integration with credit cards and bank accounts.
- Bank Transfers: A Major Player in Online Purchases
Bank transfers are a significant method of payment in Taiwan, particularly for online transactions. Roughly 25% of online purchases are made via bank transfers, a method commonly used for B2B payments or larger sums that require higher security. Taiwan’s banks facilitate both domestic and international transfers with relative ease, though fees may apply for cross-border payments.
Usage:
- E-commerce transactions
- Paying utility bills or rent
- Peer-to-peer money transfers
- PayPal: Cross-Border Transactions Made Easy
PayPal has a solid foothold in Taiwan, particularly for cross-border e-commerce. It partnered with E. SUN Bank to allow local users to withdraw New Taiwan Dollars and U.S. Dollars from their PayPal accounts, making it easier for freelancers and businesses dealing with international clients. While not as widely used for local transactions, PayPal remains a strong player for international payments.
- Alipay: Serving Chinese Visitors
Although Alipay is not as widely used by local residents in Taiwan, it serves a crucial role for Chinese tourists visiting the island. Alipay allows visitors to use their mobile devices to pay at Taiwanese merchants, facilitating cross-border commerce.
- JCB: Contactless for Public Transport
JCB cards are increasingly accepted for contactless payments in Taiwan’s mass transit systems, a nod to the influx of tourists from Japan, where JCB is a dominant payment provider. This integration helps foreign visitors seamlessly navigate transportation while keeping transactions cashless.
- Systemically Important Payment Systems
Taiwan has several key financial systems that support its broader payment infrastructure. These systems are essential for processing large volumes of transactions and ensuring the stability of the financial ecosystem.
Notable Systems:
- CBC Interbank Funds Transfer System (CIFS): Handles large-value interbank fund transfers in real-time.
- Interbank Remittance System (IRS): Facilitates smaller fund transfers between banks.
- Taiwan Clearing House System: Supports check and electronic payment processing.
Payment Trends and Future Outlook
Taiwan’s payment landscape is evolving rapidly, driven by technological innovation and increasing consumer demand for convenience and security. While cash remains prevalent, digital payment methods like mobile wallets and IC cards are expanding quickly. The government and financial institutions are also encouraging the adoption of Fintech solutions and cashless payments, especially in light of the COVID-19 pandemic.
In the coming years, Taiwan is expected to further embrace digital wallets and contactless payment options, integrating more international services like PayPal and Alipay into its local economy.
Conclusion
Taiwan offers a diverse range of payment methods, catering to different consumer preferences. Whether you’re looking to make quick payments using mobile wallets, prefer the reliability of bank transfers, or need a cash-based option, Taiwan’s system is highly adaptable. With digital payments on the rise, it’s clear that the future of Taiwan’s payment ecosystem is leaning heavily towards convenience and technology-driven solutions.