A new report by the Bangko Sentral ng Pilipinas (BSP) and Better Than Cash Alliance (Alliance) affirms the steady increase in the share of monthly digital payments made in the last two years, jumping from 10% in 2018 to 14% in 2019.
Digital merchant payments take the lead, expanding by 33% in 2019, primarily driven by high-frequency, low value retail transactions. The share of monthly digital payments by value, also increased from 20% to 24% in 2019.
Early estimates for the first semester of 2020 also provide encouraging indication for continued growth as the share of monthly digital payments by volume and by value, grew to 17% and 25%, respectively.
The COVID-19 pandemic has been a catalyst for the surge in digital payments usage in the country as physical distancing measures and quarantine protocols drove the demand for a contactless economy.
Consumers are increasingly using digital channels for remittances and merchant payments, which have grown by 39% and 66%, respectively, from 2018. The report also discusses trends in other priority use cases such as social benefits transfers and supplier payments by businesses.
According to BSP Governor Benjamin E. Diokno, “The pandemic has highlighted the value proposition of digital payments. It is a good thing that the BSP had started to chart the country’s digital transformation journey even before the pandemic hit. As a result, the foundation for an effective, interoperable and reliable payment system is now in place, and the country is beginning to reap the benefits of going digital.”
“Embarking on this development, various payments use cases are in the pipeline and will soon be available to the public, like the PESONet Multi-Batch Settlement, Bills Pay, and Request to Pay. The BSP firmly upholds its commitment to provide the needed support through an enabling regulatory and payment system oversight framework for the delivery of universal access to safe, affordable and convenient payments for all Filipinos – whichever segment of society they belong,” the Governor added.
As the BSP’s partner in this digitalization journey, Dr. Ruth Goodwin-Groen, Managing Director of the United Nations-based Better Than Cash Alliance, said, “The Government of the Philippines and the Bangko Sentral’s commitment to inclusive and responsible digital payments is building a firm foundation for accelerating progress towards the Sustainable Development Goals in the Philippines. Growing from 1% in 2013 to 17% in the first semester of 2020, is impressive! As a founding member of the Alliance, the Philippines is an example for the rest of our Alliance in making vital investments in infrastructure, creating incentives, and engaging both public and private sectors. We applaud the Philippines for creating an economy that will work better for all its citizens, and be more resilient in the future.”
The results as shown in the report are promising. The BSP shall continue to work with industry players and other relevant government agencies to modernize the country’s payment system, build user trust in digital payments and drive financial inclusion.
The BSP is committed to tracking digital payments growth. This will help ensure that the implementation of policies under our Digital Payments Transformation Roadmap 2020-2023 remains data-driven.
Our vision is that the resources deployed towards strengthening customer preference for digital payments as well as the support for the development of more innovative and responsive digital financial products and services under the DPTR would accelerate economic growth that is truly more equitable.
Stay updated with news and information from Bangko Sentral ng Pilipinas by visiting their website at bsp.gov.ph.