IoT payments to grow 24% in APAC fintech

Southeast Asian markets made up around 25% of regional fintech activity.

Mobile applications accounted for 72.62% of the Asia-Pacific fintech market in 2025, although point-of-sale (POS) and Internet of Things (IoT) devices are expected to record the fastest growth.

POS and IoT are projected to register a compound annual growth rate (CAGR) of 23.72% through 2031.

The growth is being driven by wider adoption of contactless payment infrastructure across retail environments. 

Merchants are increasingly using integrated payment terminals capable of accepting QR code payments, near-field communication (NFC) transactions and biometric authentication without requiring separate hardware systems.

In Southeast Asia, smaller merchants are also expanding digital payment acceptance. Hawker centres in Singapore and wet markets in Malaysia are increasingly using smartphone-based POS systems to avoid the costs of traditional card terminals. 

In Indonesia, many warung, or small neighbourhood shops, are adopting QR code payment systems that connect to multiple payment networks.

Despite the rise of mobile payments, web and browser-based platforms continue to hold an important role in business-to-business transactions, where treasury management, reporting tools and multi-user access systems remain essential.

The report also highlighted growing use of IoT-connected payments through smart home devices, connected vehicles and wearable technology, creating new opportunities for fintech providers to expand payment services across multiple consumer touchpoints.

Geographically, China remained the largest fintech market in the region in 2025, accounting for 40.12% of total market share. 

The market continues to be led by Alipay and WeChat Pay, although tighter regulations around data sharing and cross-border payments are limiting future growth prospects.

India is projected to be the fastest-growing market through 2031, with an expected CAGR of 27.25%. 

Growth is being supported by Unified Payments Interface (UPI) transaction volumes exceeding 100b annually and regulatory initiatives from the Reserve Bank of India aimed at promoting digital lending and financial innovation.

The report said India’s fintech sector also benefits from widespread English-language usage, supporting international expansion opportunities, whilst regulatory sandbox programmes allow companies to test new financial products before securing full licences.

Southeast Asian markets collectively accounted for around 25% of regional fintech activity.