With more and more Filipinos embracing digital payments out of necessity two years into the COVID-19 pandemic, a fully cashless Philippine society may be possible in less than a decade, a new research from global payments giant Visa suggested.
About 60 percent of Filipino consumers now carry less cash in their wallets and 84 percent have tried going cashless—reflective of how the pandemic and the consequent lockdowns have sped up digital adoption, based on Visa’s Consumer Payment Attitudes Study 2021.
Compared with the previous year’s survey, the percentage of consumers who have attempted to go cashless increased by 5 percentage points from 79 percent in 2020.
Furthermore, 38 percent of consumers said they believed that going cashless may be possible by 2025, although a bigger percentage projected that it may take a bit longer.
“Filipinos believe COVID-19 has accelerated the country’s transition to a cashless society by at least three years. Now, seven out of 10 consumers anticipate that the Philippines can become fully cashless within the next seven to 10 years,” Dan Wolbert, Visa country manager for the Philippines and Guam said in a press briefing on Tuesday.
“While cash is still commonplace in the Philippines, the preference for cashless payments is clearly gaining momentum. Our study showed more Filipinos are confident to get by without cash and for longer periods of time—with more than half feeling confident to get by for a week or longer, as cashless payment options grow,” he added.
Wolbert pointed out that going cashless meant staying safe given social distancing protocols, having convenience and being able to track financial records easily.
Visa’s latest annual study showed that bills payments, supermarket expenditure and retail shopping were leading the transition to a cashless system. This was despite the absence of travel and tourism which were big spending drivers before the pandemic.
Movement restriction orders in the past year also led to an increase in household spending for home office products, personal care items and content platform subscriptions. Home delivery also remained high, with one-third of consumers being first-time users.
The survey showed that 94 percent of respondents still identified cash as their primary payment method. However, Wolbert said this had decreased by 2 percentage from the 2020 level. Furthermore, 66 percent of consumer said they have used less cash, in line with the 60 percent who said they were now carrying less cash in their pockets compared with the previous year.
Based on the study, cashless payment usage in the country had increased across a variety of payment options. Among the preferred payment options were: mobile wallets (64 percent), card payments online (52 percent), card payments at physical merchants (44 percent) and QR (quick response) code payments (31 percent). This shows that the pandemic has also driven the uptake of cashless payment methods, especially mobile wallets and card payments online, which drew a large number of first-time users due to the pandemic.
Contactless payments, on the other hand, are seen as an emerging payment method. Eighty-three percent of Filipinos said they were aware of contactless payments while 69 percent have made contactless payments in 2021, up from 66 percent in the previous year.
The study also reported an increase in the usage of more complicated cashless payment options, such as those using digital identity and cryptocurrencies.
More Filipinos have likewise embraced newer ways of shopping, such as livestream shopping, where vendors bid out items, such as plants and clothes, and the first to type “mine” gets the goods.
Visa Consumer Payment Attitudes Study was conducted from August-September 2021 through an online questionnaire to 1,000 Filipinos across Manila, Cebu, Cavite, Rizal and Bulacan to assess consumer payment trends and interest in using new payment solutions. INQ