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E-Wallet Now Essential for Philippines Growing Number of Mobile Users
September 17, 2020 Blog

 

Written by: Rogelio Legaspi, Junior Journalist, AOPG

It would be an understatement if I say the e-wallet scene here in the Philippines is such a game-changer because personally, it lessened the struggle of payment transactions in the majority of my activities that require cash in my everyday life. Reflective of this experience, about 20 million Filipinos also use e-wallets, on each of the two biggest digital wallet providers in the country.

This is huge, considering the 100+ million population in the Philippines. The country also has around 79 million users of mobile phones, which is why e-wallets are also getting huge among citizens. This is because two of the biggest digital wallet providers in the country, namely PayMaya and Gcash, are also owned by the two major SIM card providers, Smart Communications and Globe Telecommunications, respectively.

However, the usage of digital wallets didn’t gain traction in the first years of its introduction in the country. In 2012, Globe Telecom introduced its first Gcash mobile app to iPhone users, which was limited and didn’t really make any noise at that time. Later on, they released the application to Android users in 2015 and PayMaya followed suit.

So, what shifted in the Philippines that resulted in 20 million e-wallet users today? Well, similar to other countries, social media interaction, especially the use of Facebook boomed in the 2010s. The concept of a digital wallet also made rounds in 2015 when the public rail system of the Philippines (LRT and MRT) introduced NFC-enabled Beep Card in which a passenger can reload for transportations fees.

The use of e-wallets grew exponentially during this time as stores and merchants had collaborated with various providers such as coins.ph, Gcash and PayMaya by enabling payments on mobile phones, through either cash transfer or QR codes. And that was just the beginning of the further spread of e-wallet usage in the country.

Today, e-wallets are used in almost every online activity that requires payments. Sure, you can just pay with physical cash but e-wallets provide more services and are also faster and more secure. As for my experience, my life changed when I started using e-wallets. I could transfer my money from my bank account to my e-wallet account (and vice-versa) and use my balance to buy a plethora of products and services.

Some of the major features of e-wallets providers in the country include:

  • Cash transfer: You can deposit and withdraw to and from your linked bank account. Also, you can connect your accounts on PayPal, credit card, debit card and other financial accounts. Using your e-wallet balance, you can send money to other users and receive payments from others. Businesses like Lazada and small enterprises utilise this feature for online payments.
  • Bill payments and buying loads: Users can pay for their electric, water, internet and other utility bills using e-wallets. Buying of loads for SIM cards are also made easier, even providing cashbacks and reimbursements.
  • Savings and insurance: Aside from buying, you can also make a savings account on your digital wallet, some of them even offering an interest as high as 5%. You can also purchase insurance from different companies.
  • E-wallet as a credit card: If you don’t have any balance on your account, you can also purchase products and services from partner companies by using a credit account. This depends on your credit score, which calculates the frequency of your transactions.
  • Charitable donations: There are also foundations and institutions that are partnered with e-wallet providers which you can easily donate to.

These are only some of the features that e-wallets provide in the country. However, like any other fintech company, e-wallets in the Philippines also face issues on security and reliability. During the pandemic, a round of complaints was sent to the providers on social media regarding scams and downtime issues. I even had one friend whose PayPal balance was spent on something she did not purchase.

To address these issues, e-wallet providers in the country are partnering with third-party providers such as Alipay to enhance security and protection for its users. This doesn’t stop users from utilising e-wallets though, as more and more activities require online payments in everyday life. And if there’s one thing a user wants, it’s a faster transaction on purchasing goods and services. With that, e-wallets in the Philippines are here to stay as the country adapts to the current pandemic and grows its number of digital users.

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