Country Diagnostic: The Philippines

Despite some important advances in electronic payments systems over the past two decades, the Philippines remains a heavily paper-dependent (i.e., cash and check) society. The dominance of cash is not surprising considering the country’s large unbanked population and the predominance of informal businesses, whose owners, employees and customers transact almost exclusively in cash.

This Better Than Cash Alliance diagnostic estimates that Filipinos make about 2.5 billion payments per month, or roughly 64 monthly payments per adult, corresponding to a monthly value of over US$74 billion. But only 1% of these payments is electronic, with cash and checks accounting for the remainder. While some successes in the development of a healthy electronic payment ecosystem are emerging, they are generally limited in scale and scope. A need exists for a comprehensive strategy among government and key players in the payments industry to expand usage of electronic payments.