‘…the BSP is already setting the policy and framework for payment gateways, or the folks who are actually providing the infrastructure to enable businesses to accept online payments from their customers.’
THE good thing about working from home is having more time to attend conferences and discussions about perhaps any topic you can think of under the sun. Just this last week, I had a chance to listen to two separate discussions about mental wellness and trends in the online marketing space without having to battle Metro Manila traffic. The lockdown has forced brick-and-mortar businesses to pivot quickly to digital space, and online selling has paved the way for new entrepreneurs to try their hand at home-based businesses in order to augment their current income. The digital economy isn’t a new concept, and in fact has been a hot topic of discussion in multilateral organizations like the Asia Pacific Economic Cooperation, better known to us as APEC. Incidentally, the APEC Internet and Digital Economy Roadmap was endorsed by member economies as early as 2017, and plenty of discussions on the digital economy had already taken place in 2015, when the Philippines played host to 21 member economies.
The question you may have on the rise of online shopping probably is probably whether this is a passing fancy or will it continue to thrive once we settle into post-pandemic normalcy. In the Philippines, for example, 50% of users surveyed said they are more likely to continue shopping online even after the pandemic ends. The survey conducted by We Are Social in July 2020 offers an insightful look in consumer trends that can help businesses as they navigate the current and near-term environment. It’s not a surprise that the younger generation (16 to 24 year olds) is leading the way in saying that they will most likely continue to purchase online, but at 37% of adults aged 55 to 64 years saying the same, that’s a fairly good rate of adoption. I’m guessing that this trend will continue upward, given that the survey was done back in July last year, and my sense is more people have gotten used to buying things online.
In light of these developments, what must the government do to ensure that the online space will be safe for consumers? This is where the Bangko Sentral ng Pilipinas is ahead of the curve—the BSP is already setting the policy and framework for payment gateways, or the folks who are actually providing the infrastructure to enable businesses to accept online payments from their customers. As these are all in the nature of financial transactions, the BSP is most equipped to regulate and ensure that only trusted and vetted entities can offer their services to businesses looking to migrate part of their sales online.
I believe the Department of Trade and Industry is also well aware of the boom in online commerce, judging by the exponential increase of sole proprietorship registrations they approved in 2020. Apart from persuading those in the underground economy to register as business entities (and thereby pay the corresponding taxes to the BIR,) the DTI is also tasked to make sure that consumer protection laws and regulations are better suited for online purchases. One way to ensure that folks will continue to buy online is education—how to protect themselves from sketchy sellers, what to do in case you have been victimized by a fraudulent merchant.
As in any emerging industry, it’s good for those in government to get in on the ground floor instead of playing catch up with regulations, which will invariably cause friction between regulators and the regulated industry. Until then, be careful when making your purchases online, dear millennials and fillennials. Resist the urge to act on impulse buys, and do your research first before handing over your hard-earned cash.