Octopus: The Growing E-payment System in Hong Kong

b s t r a c t Although debit/cash cards based on smart card technology promised to bring forth the end of loose change, very few managed to gain critical mass or come close to totally eliminating coins including those supported by major credit card operators (e.g., Visa Cash and Mondex). In this paper, we discuss a specific system – Octopus – which not only gained momentum among the passenger transportation industry in Hong Kong, but also expanded into other payment channels such as fast food outlets and snack machines. We examine the factors why Octopus has been successful despite most micro-payment systems failing to gain critical mass let alone expand their customer base. Finally, we conclude that convenience factors, a specific set of societal factors and its management strategy to expand from a captive market towards a generic micro-payment system had been instrumental to the growth of this e-payment system. Hong Kong. He has more than 10 years of experience researching and consulting in E-Business. He has published widely in both academic and professional journals. research interests include issues related to IS/IT adoption and implementation, information presentation and model visualization, and electronic commerce. He has published in major information systems journals including MISQ , JMIS, CACM, Decision Sciences and other publications.