Lack of trust hounding digital money transfers

Only 44 percent of consumers prefer to receive money transfers through digital platforms, indicating the continued reluctance to go fully online when it comes to financial transactions.

This is according to a study commissioned by US financial services firm Western Union to research consultancy firm Censuswide, which surveyed 2,003 people in the Philippines aged 18 and above who sent or received international money transfers from Oct.31 to Nov. 8.

“As consumers look to the future, the principle of choice on how to transfer money internationally is most appealing,” said Jean Claude Farah, president of Western Union Middle East and Asia-Pacific.

“It amplifies the need for larger ecosystems, where retail and digital platforms grow and evolve symbiotically,” he added.

The study revealed that lack of trust was a top barrier to increased use of digital money transfer services, with 31 percent of senders and 23 percent of receivers citing it as their concern.

Meanwhile, nearly 30 percent of senders and 14 percent of receivers do not transfer money online due to lack of connectivity, limited knowledge of digital services, or having no bank accounts.

Despite this, respondents to the study said they expect the flow of money to increase in the future, citing the rising cost of living today.

“Seventy-seven percent state that because cost of living has increased in the country they send to, they have to transfer more money,” the study noted, but it also mentioned that 72 percent of respondents said they were unable to transfer as much as they previously did because of similar hardships in the country they were working in.

Citing data from the World Bank, Farah said the Philippines is the world’s fourth largest inbound or receiving market for remittances, getting $37 billion in 2021 and making it one of their five top priority countries.

According to data from the Bangko Sentral ng Pilipinas, personal remittances from overseas Filipino workers (OFWs) reached $3.15 billion in September, rising by 4 percent from the $3.03 billion in the same month last year.

The remittances in September was the second highest monthly collection this year, exceeded only by remittances in July which reached $3.24 billion.

Remittances made by OFWs from the United States, Saudi Arabia, Singapore and Qatar contributed during the nine-month period.

—Alden M. Monzon