More and more Filipinos are embracing the use of electronic money transactions over the use of cold hard cash in everyday purchases as the country’s middle class undergoes changes in lifestyle.
Data from the Bangko Sentral ng Pilipinas (BSP) showed that e-money transactions rose by nearly a fifth last year, faster than the year before.
The regulator said the trend should be further encouraged because this would make the economy more efficient, and the movement of cash more transparent.
“Technology and lifestyle changes have contributed to this growth,” BSP Governor Amando M. Tetangco Jr. told reporters in an email over the weekend. “This is a desirable outcome as it increases efficiency in the domestic financial system, and promotes financial inclusion by allowing those in unserved areas access to financial services.”
A survey last year by the Better than Cash Alliance showed 98 percent of all retail transactions in the Philippines was still done using actual notes and coins. In South Korea, which leads the region in e-money transactions, 60 percent of all purchases were “digitized,” the survey showed.
Last year, the value of e-money transactions in the Philippines rose by 19.14 percent to P730.3 billion, data from the BSP showed. Since 2010, e-money transactions have grown by an average of 18 percent a year.
Tetangco said the growth could be attributed in part to the regulatory environment set by the central bank, which encourages the increased use of electronic payments channels.
The country is home to two of the world’s best known pioneers in mobile financial services—Smart Money and G-Cash, which are both run by the country’s top telcos Smart Communications and Globe Telecom, respectively.
“The regulatory environment and the safeguards we have put in place have been key in helping encourage the use of e-transactions and increasing the faith in the integrity of the same,” Tetangco said.