What Are The Current And Future Developments Expected In Digital Payment System In the Philippines?

Overseas Filipino workers send money to Philippines through the digital payment system, so we can say that OFWs are promoting a digital finance system in the country. As the central bank prepares to award them licenses, the Philippines could see its first completely digital banks by 2022. However, analysts warn that building trust and convincing clients in a country with low financial services penetration and a propensity for face-to-face interaction will struggle for the new banks.

In November 2020, the Bangko Sentral ng Pilipinas passed a new license category for digital banks. As of February, the BSP had received two applications for conversion into a digital bank, one from a new player and the other from an existing bank, according to BSP Deputy Governor Chuchi Fonacier.

What Is The Proportion Fo Digital Banking Users In Developing Country Like Philippines?

In Southeast Asia, the Philippines has one of the lowest banking penetration rates. According to the BSP’s 2019 Financial Inclusion Survey, the number of unbanked Filipino adults was predicted to be 51.2 million in 2019, out of a total adult population of 72 million. By development in digital payment system, people prefer vail online money transfer to Philippines rather going to bank for sending and receiving money.

However, the epidemic year saw an increase in financial inclusion as more Filipinos established bank accounts to get government monetary aid. Following the government’s pandemic relief effort, BSP Governor Benjamin Diokno stated in December 2020 that approximately 4 million new accounts were opened digitally between March 17 and April 30 of 2020. Filipino workers in developed countries mostly use digital money transfer services for money transfer to Philippines from their host countries.

How Does COVID-19 Pandemic Become A Catalyst To Digital Payment System Enhancement?

When the country enacted health and social-distancing protocols, the COVID-19 pandemic triggered a shift in awareness. It gave the required push for more customers – individuals, enterprises, and the government – to adopt digital payments.

The report’s findings reveal a steady rise in the volume and value of digital payments. This is positive, as the Bangko Sentral ng Pilipinas (BSP) continues to pursue a cash-lite economy and implement enabling policy and regulatory reforms to create a safe, efficient, and reliable national payment system that ensures responsible digital payments for all. Overseas Filipino workers send money to Philippines online due to halt transportation across the countries.