Digital payments have overtaken cash as the preferred mode of payment in the country for online shopping, according to Orlando Vea, PayMaya Philippines founder and chief operating officer.
Vea said cashless modes of payment, which include e-Wallets such as PayMaya, cards and bank transfers, have most likely reached a tipping point in 2020 where over 50 percent of online shopping transaction value in the country are now paid via cashless means, citing data derived from Google, Temasek, Bain & Company as well as data from Euromonitor and PayMaya.
“From Cash On Delivery, today COD now means Cashless Orders and Delivery. In 2020 alone, we processed over P95 billion worth of online shopping transactions across all of our platforms, which only shows that consumer preference for cashless payments and online shopping is overwhelmingly present,” Vea said in his speech at the recent launch of the updated Department of Trade and Industry (DTI) e-Commerce Roadmap for 2022.
Because of this development, he said the Philippines is on the cusp of an online shopping explosion in the next two years as fintech providers, digital players, businesses and the government accelerate the pivot to digital, bolstered by the updated e-Commerce Philippines Roadmap 2022.
With the updated roadmap, DTI is targeting to increase e-Commerce merchants to 1 million from a base of 500,000 and hike e-Commerce contribution to Philippine gross domestic product to 5.5 percent, from the current rate of 3.4 percent.
According to Vea, the conditions created by the coronavirus pandemic have accelerated the push for e-Commerce, but the support of players in the entire ecosystem will turbo-charge its growth all the way to 2022.
“With the guidance of DTI and the push to make e-Commerce easy for all players involved, we are seeing online shopping and cashless payments boom in the country like never before. Consumers are now used to ordering online or via their phones and paying via cashless, and many businesses have accelerated their migration to digital, so there’s no turning back now when it comes to digital payments and e-Commerce in the Philippines,” Vea said.
PayMaya is the largest merchant acquirer for key industries, processing payments for most of the Philippines’ biggest “everyday” merchants and e-Commerce players, marketplaces and providers today.
Through the PayMaya app, consumers can open a financial account that can instantly be used to pay online, either via the PayMaya virtual card or by using their mobile number to transact. The PayMaya Negosyo app, meanwhile, allows online sellers to accept QR and digital payments with setup only taking one to two days.
Last year, PayMaya saw marked increase in the number of micro, small and medium-sized enterprises utilizing its cashless payments solutions as many of them migrate or begin their operations online – with DTI recording as much as 900,000 newly registered business in 2020.
“It’s not just the large merchants now that are going into the e-Commerce fray, even small businesses are very much in play, so we really expect this sector to grow by leaps and bounds in the coming years,” Vea said.
In 2020, PayMaya users reached over 28 million Filipinos and its digital touchpoint nationwide reached over 200,000.