ACCORDING TO THE VISA’S CONSUMER PAYMENT ATTITUDES SURVEY IN 2016, FILIPINOS ARE

READY TO GO CASHLESS.

 Six out of 10 Filipinos prefer cashless payment. Today, 49% have more cards in their wallets
compared to five years ago, while 29% carry less cash. The increase of cashless payments can also
be contributed to the advent of online shopping, with online retailers such as Lazada and Zalora going
strong in the market.
 According to the survey, 71% of Filipinos now shop online at least once a month, and the e-commerce
industry is expected to grow 30% year-on-year. Aside from shopping, other online transactions made
by Filipinos involve bill payments, a more convenient way of managing their bills.
 More than half (62%) of the respondents also found carrying cash unsafe, while 57% preferred faster
transactions, which is possible with electronic payments.
 The findings from the survey indicate that banks in the Philippines are in a perfect position to leverage
on the country’s strong electronic payment opportunities.

HOW CAN FILIPINOS BENEFIT FROM BEING CASHLESS?

Leveraging on a broader range of financial services can help Filipinos to build assets, better withstand financial
shocks, and participate more broadly in the country’s economy. Filipino’s day-to-day transactions can also
become more seamless with the following benefits:

 Convenience

The ease of conducting financial transactions is probably the biggest motivator to go cashless. It eliminates the
need to carry wads of cash, plastic cards, or even queue up for ATM withdrawals. With the manic traffic in the
city, any change that can help you avoid travelling to the bank is much looked forward to. It’s also a safer and
easier spending option for people who are travelling.

 Access to better and more products

Online shopping has provided consumers more products to choose from and for many cases better deals – not
just locally, but also internationally. This will also help you make better financial decisions because you can
easily compare products and prices before making a purchase.

 Better credit health

Having the capability to track your spending will make it easier to have a better grip at your cash flow. Written
records will let consumers keep tabs on their transactions, which is the first step to successful budgeting. This
also provides consumers the opportunity to build their credit history or record, but whether it will be good or
bad, will depend on the consumer’s financial habits.

 Access to more financial products

With clear credit history, banks will be more inclusive in their products marketing or approval. It will be easier to
apply and qualify for banking products and services such as credit cards and loan – provided that you have a
clean credit record. However, this can work both ways, as your product application can also be easily rejected
due to poor financial health.

With the obvious demand for more outlets and resources for electronic payment, there’s no other way to get
around but for our country’s payment system to adapt it. The question now is not whether the country is ready
for a centralized cashless payment, but rather how well will the Filipinos adapt to it once it gets implemented in
the not so distant future.
BENEFITS OF DIGITAL PAYMENTS ACCORDING TO ZALDY D. AGGUIRE

 Digital payments can be a solution to these criminal activities. Also, recipients of digital payments can
save precious time and will have more control over the flow and use of their funds. Rather than
withdrawing money every now and then, recipients can cash out amounts from their bank accounts at
their convenience, or directly transfer funds to pay bills such as water or electricity from their electronic
wallets (or e-wallets).
 The promise of digital payments goes well beyond convenience. Digital payments are driving
consumer spending and spurring economic growth, both in developed and emerging countries.
According to reports, e-commerce transactions contributed about 10 percent to the Philippines’ gross
domestic product (GDP) in 2015. By 2020, the government expects that e-commerce volume will reach
25 percent of the country’s GDP, with the micro, small and medium enterprises (MSMEs) eyed as key
growth drivers. Undoubtedly, digital payments can be an engine in expanding the value of e-commerce
transactions.
 For the government, going digital in its payment systems can help curb corruption while improving
transparency and efficiency in payment flows. This idea inspired the administration of former President
Benigno S. Aquino 3rd to launch e-payment facilities around the government’s procurement and tax
collection processes to fulfill his campaign promise of transparency and accountability. Digital
payments generally require stringent identification documentation, making it harder for ghost or fake
beneficiaries go undetected. There is enormous potential to enhance tax collection as governments
can trace all transactions in the digital economy.

THE ROAD AHEAD

 On the domestic front, the Bangko Sentral ng Pilipinas (BSP), together with industry stakeholders,
launched the National Retail Payment System (NRPS) Framework in December 2015. The NRPS
Framework aims to fast-track the establishment of an effective electronic retail payment system,
promote a “cash-lite” economy and ultimately improve the country’s economic competitiveness.
For its part, the Bankers Association of the Philippines (BAP) manifested its support to the NRPS
initiative by establishing the Philippine Payment Management Inc. (PPMI), an entity registered with
the Securities and Exchange Commission last August 2017.
 The journey toward a cashless world can be complicated and even more challenging in emerging
markets such as the Philippines. Developing the right payment infrastructure that can provide
access to all Filipinos across many islands is clearly a daunting task. The Philippines is branded
as the “texting capital” of the world, thanks to the increasing internet penetration and the growing
number of mobile phone users despite the rather slow internet connection. This trend is
encouraging as mobile phones now serve as e-wallets that enable many unbanked Filipinos to
engage in digital payments.