January 31, 2023

Filipino Guardian

Sentinels of Filipino Free Press

PHL companies expect cashless payments to continue to grow

By Arjay L. Balinbin, Senior Reporter

PAYMENT SOLUTIONS PROVIDERS said companies in the Philippines are increasingly accepting cashless payments and this trend is expected to continue.

“More businesses are now accepting cashless payments. For example, at the end of September 2022, our registered merchant touchpoints tripled year-on-year, and many of these are micro, small and medium-sized enterprises (MSMEs),” Shailesh Baidwan, president of Maya Group and co-founder of Maya Bank, told BusinessWorld in a Email interview last week.

During the pandemic, Maya launched a digital transformation solution for businesses, enabling them to accept digital payments as they generate additional revenue from other digital services such as remittances, deposits and withdrawals, bill payments, and load transactions.

“At the height of the pandemic, going cashless was unnecessary. Nowadays, more and more Filipinos are choosing digital payments,” said Mr. Baidwan.

According to the 2022 Visa Consumer Payments Attitude Study, nearly four in five Filipino consumers (78%) plan to use digital payments more often, with three in four (79%) believing it is safer.

“This growing demand for digital payments continues – there is no turning back from this rising tide,” Mr Baidwan said, adding that everyday transactions such as loading airtime, bill payments, money transfers and purchases are driving the growth.

He noted that more digital banking services like savings and loans are driving digital payments.

“We see this in our Maya app – customers who have savings accounts, for example, are very active in using their wallets for day-to-day payments because the experience is practically seamless and intuitive,” added Mr. Baidwan.

GrabPay, also a payment solutions provider in the Philippines, said it continues to see growth in cashless transactions despite the full reopening of the economy.

This is being “driven by both online and offline merchants,” GrabPay said in a statement to BusinessWorld last week.

“We are seeing more and more retailers accepting payments through e-wallets. This is particularly evident among offline merchants with the implementation of PH QR,” she added, referring to the national QR (Quick Response) code standard developed by Bangko Sentral ng Pilipinas and Philippine Payments Management, Inc introduced in 2019.

Martha M. Sazon, GCash President and Chief Executive Officer, said the company has noticed higher user engagement “now that things are starting to normalize.”

This is “further evidence that GCash is embedded in the everyday lives of Filipinos,” she said in an email statement.

GCash had 66 million users in the second quarter of the year, while Maya, which was rebranded from PayMaya in April, had 50 million registered users on its consumer platforms.

Mr Baidwan said Maya had “powered over 700,000 registered merchant touchpoints with QR payments”.

According to GCash, it expanded its deposit and withdrawal sites to 339,000 in the first half of the year.

“It just goes to show that Filipinos’ shift to a more digital lifestyle is not limited to times during lockdown. We continue to see increasing adoption, and even everyday usage and the variety of use cases is increasing. I think adoption is here to stay and we don’t see a plateau anytime soon,” Ms Sazon said.

Food and beverages accounted for the largest share of total e-commerce transaction value last year due to the popularity of online grocery sales and on-demand food delivery services in public health, according to London-based data analysis and consulting firm GlobalData Plc.

“This has kind of slowed down as lockdown restrictions started to ease, but is picking up again, especially around the holidays,” GrabPay said.

Maya’s Mr Baidwan said people are now enjoying more mobility in the “early post-pandemic period”. The return to normal is leading to an uptick in digital transactions across travel, entertainment, groceries and retail, he added.

“The share of offline payment transactions for groceries and groceries has grown at double-digit rates year-on-year, even as consumers continue to order and shop online. Entertainment and travel-related transactions saw the highest volume growth, based on data from 2022. Travel-related transactions grew 10x year-on-year in May this year, while entertainment grew 9x over the same period,” Herr said Baidwan .