Many Filipino households lack sufficient funds to open a deposit account and this leads to the problem of having high unbanked percentage in the Philippines. With an approximate 86% of Filipino households unbanked, the trend towards cashless payment modes allows unbanked users to be more easily integrated into banking services. This encourages greater financial inclusion where local banks gain the chance to provide banking services to more Filipinos.
With increasing usage of digital platforms, Albert Tinio, president of G-Exchange Inc., operator of cashless payment service GCash said, “Filipinos have come of age and are ready to take the next step forward. We are world leaders when it comes to social media and we are very comfortable with the Internet. We have gone beyond calls and text and we seek to do more with our mobile phones. Thus, mobile financial services present an opportunity to complement mainstream financial services to serve millions of financially underserved Filipinos.” Currently, there are 73 million mobile phone users in the Philippines, 34 million smartphone users as well as 67 million Filipino users online at any point of time.
Digital adoption has been spearheaded by the youth and enterprises giants such as PLDT Inc. and Globe, through QR code payment integration. The youth’s familiarity towards digital platforms also allows easy adaptation of cashless payment modes. Following that, the Philippines can shift their focus on households with better access to technology and lastly, provincial areas.
Besides that, Globe has included a new GCredit feature where a trust score avails loans. In addition, partnership with Alipay HK for cross-border remittance business would grant overseas Filipino workers situated in Hong Kong to remit money instantly through the GCash app.
The concept of going cashless is no longer foreign with numerous countries such as US, Singapore and Canada progressing towards a cashless society. With integration of QR code system, customers can purchase goods and services via their smartphones. To take a step further, Singapore’s upcoming SGQR initiative would allow merchants to integrate all mobile payment methods in one single QR code. This would reduce confusion among consumers and thus, encourage cashless payment modes, reflecting Singapore's immense efforts towards becoming a cashless society.