Dynamic cross-border payment preferences: A qualitative study of Indonesian expatriates in Thailand and Malaysia

Abstract

Along with the development of global digitalization, international financial transactions are also advancing. In response, Indonesia (Bank Indonesia) collaborated with Malaysia and Thailand by launching Local Currency Settlement (LCS) integrated with Quick Response (QR) codes to reduce the use of dollars in cross-border transactions. Therefore, this study aims to investigate the Indonesian customer (Indonesian expatriates) preferences for payment methods provided by Bank Indonesia, specifically in the context of facilitating cross-border transactions. The number of research participants was 50 Indonesian expatriates (36 in Thailand, 14 in Malaysia), who were purposefully selected based on the criteria of being Indonesian traveling, studying, or residing in Thailand and Malaysia while maintaining Indonesian bank accounts. To identify these preferences, this study uses qualitative research using the Analytic Hierarchy Process (AHP) method. Based on the Hierarchical analysis, the results show that the main alternatives in payment method preference in Thailand and Malaysia show that Visa is still the most dominant in cross-border transactions. Across hierarchical criteria, including trust, speed, usability, installment flexibility, timing, and offering interest-free installment plans, Visa consistently outperformed QR Codes and Cash. Nonetheless, it is essential to highlight that QR Codes scored the highest in the criteria of Ease of Use in Malaysia. While in Thailand, QR codes achieved the highest score in terms of cost-effectiveness.