The crowd favorite of Lunar New Year festivities — hongbao, angpow or ‘red packets’ — have been made contactless just like everything else.
We all knew that the Lunar New Year celebrations in the region would be a muted affair. But one of the most sacred and beloved traditions of all is now a no-no: red packets!
In Singapore, the Monetary Authority of Singapore has encouraged residents to use digital red packets in their festive traditions instead of the physical red packets that can harbor infectious agents.
The move also makes the yearly ritual to queue up at the banks for fresh bank notes unnecessary, again a way to reduce overcrowding and social-distancing mishaps. The Association of Banks in Singapore (ABS) is therefore actively promoting e-gifting for the festive season.
For diehard traditionalists who insist on using fresh bank notes for physical red packets, an online booking system will help to protect people, especially in a period where new viral mutations must not be allowed to propagate.
Inviting e-gifting innovation
Additionally, MAS and ABS are encouraging fintech firms to develop e-gifting solutions for different purposes, including gifting during festive periods. The most innovative e-gifting solution will receive special recognition at the Singapore FinTech Festival in November 2021.
According to the two agencies, digital red packets are also environmentally more sustainable as they reduce the demand and subsequent wastage of new notes that are returned by the public to banks after each Lunar New Year.
In cases where people still insist on exchanging money for new bank notes, an online reservation system will be used across local banks to separate the vulnerable elderly from others collecting the notes.
Said MAS’ Assistant Managing Director, Finance, Risk & Currency, Bernard Wee: “The adoption of e-payments grew significantly this past year as it is more convenient than cash. The coming Lunar New Year offers an opportunity for us to build on this momentum, to spread the benefits of e-gifting, and to forge new traditions with our families and friends. E-gifting helps to reduce the queues at banks, and also helps to reduce the carbon emissions generated by the production of new notes for each Lunar New Year, estimated to be about 330 tons currently. This is equivalent to emissions from charging 5.7 million smart phones or one smart phone for every Singaporean resident for five days.”
Are e-red packets safe?
Just like any secure transfer of cash in daily e-commerce activities in the country, digital red packets will be safe from hackers. Givers can e-purchase specific denominations of e-red packets of S$8.88 or S$28.88 and issuing paper slips with a QR code to recipients.
Another way is to use the PayNow fund transfer system commonly used in Singapore.
As with anything digital, some risk is possible, said Christopher Yap, Regional Head of ASEAN and Hong Kong, BioCatch. “While the transition to mobile-first banking offers banks a tremendous opportunity, cybercriminals are also following the money to mobile, capitalizing on weaknesses in the mobile banking journey.”
According to Yap, in today’s fast-moving environment where user mobility and frequent device changes have made it difficult to validate a user based solely on location, device, and network elements, banks are looking for innovative ways to deliver top security without compromising customer experience, or more importantly—customer trust.
“Behavioural biometrics technology delivers a fresh approach to mobile banking fraud protection— the technology detects anomalies in user behavior by monitoring how information is entered, and not just what information. Powered by machine learning, the tech takes into consideration real-time mobile-specific interactions such as swipe and scrolling patterns, tap gestures, and touch events,” he said. “In the case of digital red packets, the technology learns unique user behavior patterns and identifies subtle anomalies that can indicate high levels of risk during a transaction.”
Ultimately, as long as the essence of the tradition is retained, people will just have to embrace digitalization in just one more aspect. After all, if foregoing paper-based symbolism will help to protect friends and loved ones, then the sacrifice is worth it.
However, banks and customers alike should also broaden their efforts to ensure the collective online safety of users this Lunar Year of the Ox by being vigilant to potential fraud and abuse of e-gifting technology.