For many businesses in the country, paper still rules. The majority of transactions are paper-based, goods and services are paid with paper money or cash, and enterprises keep physical books.
Every month, there are about one billion supplier payments made in the country but less than 2 percent of these are done digitally.
Informal businesses, which account for about 85 percent of all supplier payments, rely solely on cash, according to the “State of Digital Payments in the Philippines” published in December 2019 by the United Nations-based Better than Cash Alliance.
Lockdowns and physical distancing arising from the COVID-19 pandemic protocols, however, are rapidly driving many businesses to digital platforms.
For many businesses, especially the micro, small and medium enterprises (MSMEs), this remains an unfamiliar territory.
“In the last 10 years, we have seen many local companies investing a great deal in supply chain management to improve the way they source and distribute goods and services.
However, many of the efficiencies they have gained end up for naught just because their payment process is still manual. This is the reason business-to-business payment has not seen a corresponding increase in efficiency despite the availability of digital payment programs,” said Ronald Magleo, chairman and founder of Paynamics Technologies, Inc., a Philippine-based company with a 10-year track record in enabling financial services through various digital payment methods.
Sensing the urgency for MSMEs to bounce back from the pandemic-induced economic recession, Paynamics recently launched Paynamics Biz, a secure e-money accou nt facility that helps solve MSMEs’ major pain points.
Mylene Chua-Magleo, president and chief executive officer of Paynamics, said there are several ways that Paynamics Biz can help MSMEs:
Simplify payments and collection. Paynamics Biz simplifies the entire payment and collection process for MSMEs. Once a customer transaction has been created, Paynamics Biz will take care of collecting the payment on behalf of the MSME.
Gain flexibility. The MSME does not have to be tied down to a payment partner as Paynamics Biz provides an agnostic platform that enables payments acceptance from various methods (both online and offline). Have peace of mind. Paynamics e-payment system undergoes periodic third-party audits and risk assessments to ensure its compliance with strict security and compliance standards.
Paynamics is also backed by the strength of its strategic partners: Beenos Inc., a publicly listed Japanese e-commerce operator, and Expresspay Inc., a fintech aggregator in the Philippines operating since 2011.
The company fully supports the BSP’s advocacy for more Filipinos to use technology to spur wider access to financial services and offer convenience, efficiency, and transparency to customers and businesses. “With Paynamics Biz, we are targeting to register over 100,000 merchants over the next three years. During this period, we aim to have more than 60 percent actively using our e-payment services,” Mr. Magleo said.
The fast-growing fintech company expects to generate 100,000 transactions per day by 2021 and by eight times bigger by 2025.