Amid the pandemic, digital services and platforms became the primary means of transaction among Filipinos, a Bangko Sentral ng Pilipinas (BSP) official said.
In her presentation during the 18th Development Policy Research Month virtual kickoff forum held recently, BSP Assistant Governor Iluminada Sicat said the central bank saw an increase in electronic fund transfers vis-à-vis automated teller machine (ATM) withdrawals and check transactions during the lockdowns and quarantines from March to May.
BSP Governor Benjamin Diokno earlier reported that a comparison between the two and a half months duration period prior to the lockdown from January 1 to March 16 and the period under lockdown from March 17 to May 31 showed combined transactions of both PESONet and Instapay rose by over 70 percent in volume and 42 percent in value.
Sicat said that without a vaccine, this increasing trend in digital transactions is expected to continue “even as lockdown measures are eased.”
According to her, the government’s initiatives to digitize payments for social benefits, wages and transportation would further boost digital payment platforms.
She said the creation of a national identification card system will enable Filipinos to open bank accounts “and gainfully participate in an increasingly digital economy.”
Citing the 2019 Financial Inclusion Survey, Sicat said there are opportunities in the country that should be explored in promoting the use of digital payments in the Philippines.
In terms of mobile phone owners, only 12 percent out of the 69 percent of adults who own a mobile phone use them for financial transactions.
In addition, only 9 percent of the 53 percent of adults with internet connection use it for financial transactions.
Sicat said that seven out of 10 unbanked adults have a mobile phone, “which represents an untapped opportunity for digital finance.”
While there have been developments and various initiatives from the government and other key sectors in the utilization of e-finance, Sicat noted that “lack of awareness and trust remains to be the main barriers in [the] usage of mobile phone and internet for financial transactions”.
“The BSP believes that promoting digital literacy plays a crucial role in deepening the public’s trust in digital financial services,” Sicat said.
She also emphasized that widely shared access to affordable and fast internet connection and universal access to the national ID system “will facilitate the scale and reach of digital financial services.”