Digital payments increased by a total of 33 percent between January and September. It was able to penetrate the P1 trillion level, mainly because the regulatory environment at this time is enabling.
The increasing number of providers and aggressive marketing allowed for digital payments to reach new heights.
According to Melchor Plabasan, Banko Sentral ng Pilipinas’ Technology Risk and Innovation Supervision Department’s director, claimed that electronic money transactions, whether incoming or outgoing reached unprecedented levels on the months assessed.
It totaled the amount of P1.04 trillion within that 9-month period, as reported by Phil Star. This is a marked increase from the 2018 period for the same period at P784.92 billion.
The director added that e-money transactions handled through banks increased by a significant 12.8 percent, from P667.17 billion to P752.4 billion.
Non-bank electronic money issuers that handled digital payments also saw some significant increase in volume – by a total of 147 percent. The 2018 figure of P117.74 billion jumped to P290.3 billion.
Why the Increase in Digital Payments?
There are several explanations to this.
According to Plabasan, these increases in the inflow and outflow transactions can be the effect of promotional strategies. Prime examples include cash backs and discounts.
It is also simply easier to engage in e-money transactions these days.
The director said these trends are encouraging to see. It implies Filipinos have become more aware and knowledgable about using their phones and prepaid cards for daily consumption needs.
At present, the BSP already issued over 50 EMI licenses to 31 banks and 20 non-banks so they can handle digital payments.
Some notable examples of non-bank EMIs are Grab’s GPay Network Philippines, Alipay Philippines, PayMaya Philippines, InfoServe and many more others.
Back in December 2015, the BSP established the National Retail Payment System.
This led to the introduction of various clearing houses that were anticipated to increase the level of digital payments to 20 percent by 2020.
Notable examples are PESONet and InstaPay.
20% by 2020
If the target increase is reached next year, this will be a significant leap from the one percent digital payments posted in 2013.
2013 was the year when Philippines started to shift from a cash-heavy economy to a cash-lite one.
BSP and Philippine Payment Management Inc. also established the EGov Pay Facility for relevant purposes.
It allows consumers to pay taxes and other government fees online. It also acted as a QR (quick response) PH for individual money transfers between one person to another.
Plabasan claimed that this rising trend plus the BSP’s persistent efforts to make online payment facilities accessible and safe are optimistic signs.
They act as great indicators that they can reach the targeted 20 percent electronic payments by 2020.
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