According to the BSP, in 2017, cashless payments accounted for Php 481 billion. There’s no escaping the shift from paper to electronic transactions when it comes to purchasing goods, paying bills, or even transferring an amount of money. The convenience it offers any businesses is incomparable to physical transactions.
As a business owner, it only makes sense to make the shift from paper to electronic. Modernizing your payment method will not only attract more clients, but also retain them. Furthermore, you need to realize that more and more people are trading in long lines and crowded malls for the ease of transactions with the click of a button on their PCs or phones. It only makes sense for the consumer to choose a more convenient route.
Convenience for the consumer
According to the annual Visa’s Consumer Payment Attitudes Survey, 71% of Filipinos shopped online once a month via PC and 50% using their smartphones in 2016. And it’s easy to see why Filipinos are becoming more interested in cashless transactions:
Consumers only need to encode their information on the website once
Online shops and even service providers only require a one-time registration process where you input your personal information including credit card number and shipping address. The next time you log in, shopping or paying bills online is as easy as a few clicks.
Mobile banking makes transactions a cinch
Online banking syncs your accounts to their respective mobile apps and allows you to view your account with every transaction, whether you’re out shopping or doing an online transaction. Mobile banking also makes the transferring of money to other accounts an easier alternative to traditional bank deposits which also benefits online vendors with its ease and convenience.
Convenience for the business owner
According to the aforementioned survey, eCommerce growth has also been up by 30% meaning there is a large potential in the Philippines for the convenience of electronic transactions. Fewer and fewer Filipinos are opting using cash with the survey citing that 62% found that carrying cash was unsafe while 57% preferred faster transactions through online payments.
Save money with electronic payments
Businesses who opt to utilize electronic payments find that it lowers their cost. The more electronic payments are processed, the more the business saves on paper and postage. In a general perspective, transaction costs are also lowered, saving on trips to the bank and payment centers. Also, E-cash transactions have minimal to no additional fees.
Increase sales and keep customer retention
In the Philippines where the technology is still in its early stages, there is huge room for growth for electronic payments. In the same survey, 70% of Filipinos would prefer automated payments. Businesses with e-payment options are able to sell to customers who prefer to this automated method; thus, already gaining a competitive advantage over those who stick to the traditional payment methods of cash.
Customers are also more likely to return to a business’ e-commerce website to purchase where he or she has already registered information that has been stored in the company’s database.
Online payment options in the Philippines
As e-commerce grows in the country, its vendors have encouraged consumers to purchase using online payment methods that aren’t limited to online banking and its corresponding apps. In the Philippines, there are numerous ways to transact electronically that both fits the needs of both the online consumer and its vendors.
- Electronic & Mobile Payments
TELCO companies have jumped on the e-payment bandwagon have their respective payment solutions, while receiving large sums of investments from notable companies.
Smart provides its SIM users with Smart Money which allows users to purchase and even pay bills online using a designated account number where merchants accept payments. Linked to a Mastercard, all payments made with the ewallet will be considered as a credit card transaction. A one-time registration fee is required while users are billed an additional Php 2.50 per online purchase.
Through PayMaya, Smart has extended it's payment product line to offer payment solutions to personal and small business . PayMaya recently received investment commitments of $215 million from Tencent and KKR.
Similarly, Globe Telecom has its own version of an e-wallet called GCash. Globe SIM users may activate a GCash account which costs Php 50 per month. Users enter their designated mobile number linked to the GCash account on their preferred E-commerce sites and purchases will be automatically deducted from their e-wallet.
With Alipay's investment in Mynt (a Globe subsidiary) and Tencent's investment in PayMaya, the Philippines should see better payment options.
- Payment Gateways
While PayPal has become the quintessential electronic payment option for online transactions worldwide, the Philippines has its local payment gateways like DragonPay that when integrated in an e-commerce site links allows customers to pay via banks or PayPal, or in any of their partner payment centers for anything from retail, travel, and even entertainment. A one-time set-up fee is required for merchants while every transaction online also requires a small fee.
A less expensive alternative is JuanPay which allows payments through credit cards, over-the-counter deposits, and even through e-wallets like Smart Money and GCash. There is no initial sign-up fee but merchants are charged a small 1.5% fee for every processed payment.
- Coins.ph
Originally a Bitcoin trading platform in the Philippines, Coins.ph has expanded to cater to e-commerce sites. The user may pay using a Bitcoin wallet where he or she will take the funds from. Coins.ph also has an app for convenience that allows money transfers through partner establishments like convenience stores, banks, pawnshops, and payment centers.
