Pandemic accelerated PH consumers’ shift from cash to digital payments
More Filipinos are now using digital channels to conduct transactions — including critically important payments — due to the profound impact of the coronavirus pandemic on their daily lives, especially limitations on physical movement that are imposed by the crisis.
More importantly, as many as nine out of ten local users to electronic payment systems now prefer making cashless transfers over cash payments due to public health considerations.
Thus said international payments firm PayPal citing its latest study on the adoption over the last few months of digital solutions among Filipinos, the majority of whom had overwhelmingly preferred to transact in cash before the Covid-19 outbreak for reasons of convenience and practicality.
“While cash remains the most dominant method of payment in the Philippines, circumstances brought on by the pandemic have given digital payments a more prominent role in the everyday lives of Filipinos,” PayPal senior director and Southeast Asian head of sales Rajkishore Agrawal said.
The results of the online survey showed that that 87 percent of Filipinos increased their usage of digital payments during the pandemic, while 90 percent said they preferred to digital payments over cash during this time.
The 2020 PayPal Consumer Insights Survey was conducted among 500 local respondents with the objective of identifying the impact of COVID-19 on local payment behaviors.
“As the pandemic continues, health and safety need to be a fundamental part of our everyday decisions,” the official said. “But when you consider continued usage of digital payments, convenience and security also play vital roles.”
The findings jibe with a recent study by the World Bank and the National Economic Development Authority which suggested that the use of digital technologies such as digital payments, e-commerce, telemedicine, and online education helped the Philippine economy cope with social-distancing measures, business continuity and public service delivery.
At the same time, however, the survey found that 49 percent of respondents identified security as the topmost consideration when choosing which digital payment platforms to use.
More importantly, respondents said the new method of transaction is here to stay, with an overwhelming 99 percent saying they plan to keep using digital payments even after community quarantines are eased.
According to PayPal, the majority of Filipino respondents used digital payments to pay for bills (44 percent) and groceries (36 percent).
This digital shift has also introduced many locals to the convenience of overseas shopping.
“Usage of digital payments opens the door to global e-commerce markets for Filipino shoppers,” Agrawal said. “Once they experience the benefits—mainly convenience and security, it opens a wide array of options for them in terms of shopping choices.”
From May to August this year, 61 percent of the survey participants said they purchased from international merchants with the most common purchases being for fashion (41 percent) and technology (34 percent).
The survey also found that seven in ten plan to continue purchasing from international merchants in the coming three months.
When it comes to payment platforms for cross border purchases, 77 percent of respondents cited PayPal as their most preferred method. The digital payments platform has an estimated 361 million account holders in over 200 markets across the world. It is also available for different currencies, giving users unparalleled flexibility to make international payments.
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