Digital payments in the Philippines - statistics & facts
Gone are the days that paying for your groceries or shopping baskets was limited to cash payments. Today, most retail stores and supermarkets allow the use of mobile wallets and contactless payment services using your mobile devices. Although this service may not yet be available in smaller cities, online payment services have become a part of the in-store and online shopping behavior of Filipino shoppers. In 2023, the Philippines made one of the highest digital payment transactions in Southeast Asia, with a forecast growth in the upcoming years.
Digital payments in the Philippines can be expected to continue growing in the coming years as more customers and businesses use these services. However, the prevalence of online security threats may hamper the prospect of a digital-only payment landscape.
Mobile wallet takes the lead in cashless payments
The Philippines has one of the lowest banked populations in the Asia-Pacific region in 2023, making alternative payments a more convenient option. Although several banks have already made it easier for customers to open an account online, more Filipinos have opted for e-money accounts over traditional bank accounts since signing up only requires a phone number and a valid ID. In fact, the digital payments already exceeded non-digital payments in the volume of monthly retail payments made in 2023, from just 10 percent in 2018. When it comes to e-commerce transactions, mobile wallets had the highest share of payments used, followed by card-based payments. In 2023, there were nearly 397 million mobile wallet accounts in the Philippines, spread out across different providers. GCash continues to dominate the mobile wallet application landscape, accounting for the majority of market shares.The rise of QR-based payments
QR-based payments were also essential alternatives for cashless transactions. The Bangko Sentral ng Pilipinas, the country’s central bank, introduced QR PH in November 2019 for peer-to-peer (P2P) payments. Two years later, the person-to-merchant (P2M) payment system was also created to allow payments to establishments such as drug stores and department stores. In 2023, the volume of QR PH person-to-person (P2P) payments registered a 600 percent increase from the previous year. Meanwhile, the volume of person-to-merchant (P2M) payments introduced in 2021 saw a 2,800 percent increase. QR Ph allows customers to pay for their purchases using their preferred app, regardless of the bank they are affiliated with. It also is enabled for transfers and payments to non-banking financial institutions. ÂAre digital payments replacing cash?
Digital payments are advancing in the Philippines, as seen in the volume of transactions made using mobile wallets and QR code payments. Nevertheless, cash is not going anywhere, especially for in-store payments, which remain to be cash-heavy. Increasing online security concerns also affect Filipino customers, particularly threats of phishing and smishing. In fact, between February and March 2022, payment systems recorded the highest share of financial-related phishing attempts in the Philippines, further adding to the security concerns of those who use cashless services.Digital payments in the Philippines can be expected to continue growing in the coming years as more customers and businesses use these services. However, the prevalence of online security threats may hamper the prospect of a digital-only payment landscape.
