Cash continues to be king within the Philippines. Only one in ten Filipinos conducts online transactions through their bank accounts, regardless that half of the country’s 102 million people already use the web.
Of the two.5 billion bank payments price US$74 billion (S$105 billion) per 30 days, only one percent, or about US$740 million, are electronic, and many of the payments are for small amounts. That equates to about US$60 per 30 days for the 11 million individuals who make online payments through their bank accounts. The overwhelming majority of bank transactions, by value, are still done in money or checks.
“The Philippines is more of a cashless economy than a cashless economy,” said Ms. Nick Wilwayco, head of communications at e-commerce company PayMaya.
But the boom in cell phone usage could soon change that. The Philippines is the fastest-growing smartphone market in Southeast Asia. Currently, 40 million Filipinos own smartphones, a number that is predicted to rise to 90 million by 2021.
“Filipinos are more mobile savvy. They find it easier to discover and use them,” Ms. Wilwayco said.
Using Apple, Android and Facebook apps, in addition to “digital wallets”, cell phone users can open credit and debit accounts that they will use to conduct online transactions without the necessity for a checking account or web access; all they need is a SIM card.
Voyager Innovations, the telecommunications unit of Smart Communications, now has greater than 11 million customers using its smartphone app to pay for online and in-store purchases, transfer money and even secure loans. It declined to supply exact growth figures, saying only that it’s “triple digits.”
For Geraldine Rodriguez, 47, a contract author, going cashless means convenience and peace of mind, regardless that only a fraction of her day by day transactions are done online. She pays her monthly phone and web bill of about 1,650 pesos (S$46) online through her checking account and uses a prepaid card when she uses the MRT. But she still has to pay most of her bills at a centralised payment centre.
With less money, she feels less anxious about being mugged or having her wallet stolen. “Is it convenient? Very convenient,” Ms. Rodriguez said.
Banks have long been a hindrance to the broader adoption of online payments. Only three in five Filipinos have bank accounts, amongst them 11 million who pay bills, order takeout and buy airline tickets, gadgets, clothes and fashion accessories online using ATMs, bank cards and debit cards.
Many individuals are still concerned about security and privacy. In a report published last July (2016), web security company Trend Micro found that the Philippines is the third most affected country by online banking fraud. This is why smartphone apps have proven so attractive, as they free people from having to make use of their bank accounts to make payments or actually have a checking account.
Source : www.straitstimes.com
