According to the latest e-payments data from the Bangko Sentral ng Pilipinas (BSP), digital payments grew by over 30% in 2021 from 20% in 2020.
The rise in e-commerce is one of the key factors in the increase along with peer-to-peer (P2P) remittances. As more and more companies transform their processes digitally, employees’ salaries and wages have also been done digitally. BSP said these are “high-frequency, low-value retail transactions.”
“The latest results show we are closer to meeting our objective of converting at least 50 percent of retail payment transactions to digital form by the end of 2023, under the BSP Digital Payments Transformation Roadmap,” BSP Governor Felipe Medalla said in a media statement.
BSP also said, “The value of digital payments in the country represented 44.1% of total retail payments in 2021, up from the 26.8% recorded a year earlier.”
According to data analytics and consulting company GlobalData, the government is looking to increase the e-commerce contribution to the GDP from 3.4% in 2020 to 5.5% in 2022. And as online shopping becomes the new normal prompted by mobility restrictions at the height of the COVID-19 pandemic, merchant payments will further support the growth of electronic payments. The volume of merchant payments increased by 43.8%, while P2P remittances grew by 268.6%.
Business payments of salaries and wages grew by 170.2% during the period.
“This indicates that for salary disbursements, businesses are transitioning from cash to digital channels, such as electronic fund transfers to bank or e-money accounts,” BSP said. “Moreover, the significant rise in the use of account-to-account electronic fund transfers could be seen as a result of expanding access to transaction accounts and the shifting preference of consumers toward the use of digital modes for payments.”
“This capability for digital transactions should be within reach of every Filipino in our increasingly digital economy,” Medalla said. “Hence, the BSP, with the support of the payments industry led by the Philippine Payments Management, Inc., continues to promote a vibrant and inclusive digital payments ecosystem where every Filipino can actively participate and enjoy its benefits,” he added.