Allyza Estacio, Feature Department
Moving to a cashless society seems like a sci-fi movie way back in 2012. But due to modernization, it hasn’t been a dream as we now have different electronic cash or e-cash applications that are within reach through our mobile phones. Give time to observe your daily surroundings from supermarkets, canteens, and even the small “sari-sari” stores. Along with the common goods displayed, is an E-cash QR code signage, ready to scan for customers. And these aren’t only the places where you can spot those codes, you can also see them in public transportation or any counters. From this, it is safe to conclude that digital money transactions today have become a part of most Filipinos’ mode of payment. However, are we indeed ready for it?
In a press briefing, Jeff Navarro, the Visa country manager for the Philippines and Guam, presented the recent result of the Visa Consumer Payment Attitudes Study. Based on the data interpreted, the usage of cash payments in our country has eased as the cashless payment method made its way into various retail outlets. The survey was conducted online from October to November 2023, with 1000 Filipino consumers ages 18 to 65 years old as the respondents, noting the decline of cash usage to 87% last year, compared in 2022 having 96%. One out of three consumers even believed that by the year 2030, the Philippines will be a cashless society.
As a statement of Navarro released in GMA integrated News, “Our study shows that the cashless wave is maintaining its momentum in the Philippines. We are moving closer to achieving a cashless Philippine society, but we still have some way to go,”
It is certainly a transition that will take time to be fully adopted especially despite the mobile wallet going mainstream, a lot of issues and concerns remain to cloud the minds of our consumers.
Survival of the Fittest
For a quick background on how it was manifested and where it started, this writer would like to bring up the concept of Darwinian Evolutionary Theory which, to sum up, implies that for an organism to survive it must adapt and answer to its environment. Many academic research papers and articles are now published discussing how the COVID-19 pandemic paved the path of digital payment here in the Philippines as a means for economic recovery. Due to this innovation, businesses were able to continue their operations under the new normal as this step was also supported by the government, quoting what Henry Aguda said in an article published in 2020 by Chris Wright under the Asiamoney website, “This is Bangko Sentral’s ambition: to move digital”
Mobile wallets might have existed earlier than the pandemic but their usage catapulted due to the mobility restriction we had experienced, the proof of this was the doubled number of Filipino adults with bank accounts, from 29% in pre-pandemic 2019 to 56% in 2021 (as per Lawrence Agcaoili from the Philippine Star). An interesting outtake of believers during that time was despite these restrictions being lifted many will still use digital banking or ecash as they grew accustomed to its convenience. True enough, flash forward to 2024 we are now experiencing massive growth in the number of its users.
But the challenge for the Bangko Sentral and developers of mobile wallets remains: cyber-security.
E-cash or Cold Cash?
Moving forward, to assess whether we are ready to shift to cash-light from cash-heavy, let us weigh its Pros and Cons. As alarming as it might get for some that there is indeed a Con here in digitalization or mobile wallets, first see the benefits of having to Cash-in, before saying no completely and Cash-out. Deciding to finally utilise this digital payment transaction it is expected for you to experience convenience, security, and accessibility.
Convenient, given that you no longer have to bring an actual wallet containing your money and cards as payments would be one swipe away, this reason could also be applied for security. Expanding the benefits in security, most E-cash applications use either fingerprint or face recognition (biometric authentication), encryption, and tokenization to ensure the safety of information for banking which means it’s harder for thieves to steal the mentioned personal details.
In terms of accessibility, mobile wallets help you store your savings or loyalty cards in one place. This could be convenient whenever you’re in a hurry and of course one place means less things for you to carry. Another benefit many users are fond of are the discounts and rewards provided, making purchases cheap and less than the supposed amount payment.
Moving forward to possible challenges we might face in switching to digital wallets. Despite it’s accessibility you might also want to consider that this mode of payment isn’t widely accepted by many merchants, some of them still prefer the traditional transaction. Aside from that, not all areas have strong internet signals and other technical issues for example bugs in the software or problems in the devices such as malfunctions or lags.
Then of course even if they’re using biometric authentication, it is still considered that traditional wallets aren’t entirely subject to danger. It is given in this age that thieves or criminals had revolve to cybercriminals as well, through hacking they might still manage to have access to your digital wallet and personal or banking information. At last dependence on technology, as inviting as cash-light sounds, if somehow you found yourself in an unfortunate situation where you misplaced, lost your smartphones, or couldn’t have any internet access e-wallets would no longer be accessible.
Cash-in or Cash OUT?
Now that pros and cons were laid out, the decision on whether to switch or not is entirely up to you. When it comes to savings and finance in these hard times, being cautious is a valuable trait that one could mostly benefit from. After all, money is a fruit of our labour and sweat. Risks shouldn’t be in the conversation or an option unless you can afford it of course, but generally speaking no one would want to be a victim of cybercrime most especially when money is the concern. So, considering all the possibilities on both negative and positive sides in ties with reality, is our Country safe from hackers and online thieves? How sure are we that our cybersecurity is tight?
A cashless society, digitalization, and a top-grade modern technology is not entirely a bad idea. Innovation at the end of the day still reflects progress, but to bring this vision to life the challenge would still fall to the hands of our government, given that these steps mean we’re indeed moving forward but it doesn’t always signifies growth. Just like how the pandemic pushed us to adapt digital payments for survival, instead of voluntarily shifting to it because we finally can. Another example that could be brought to the table is the hastened sim registration, yes it was implemented, many were forced to comply, but the spam callers/messages didn’t seem to vanish and the treat in our security remains.
So go ahead, partner your ambitions first with hard work and concrete plans. Align progress with long-term impacts that ensures growth at the same time innovation because we Filipinos deserve it, the security, stability, and not just a leap of faith. Get the trust of your citizens to cash-in, instead of only cashing out their taxes.
References
Cordero, T. (2024). Cash payments in decline as more Pinoys go cashless — study. https://www.gmanetwork.com/news/money/economy/899042/cash-payments-in-decline-as-more-pinoys-go-cashless-study/story
Cunningham, C. (2024). survival of the fittest. https://www.britannica.com/science/survival-of-the-fittest
Wright, C. (2020). The Philippines: Covid-19 helps a digital revolution. https://www.asiamoney.com/article/27hz7xvjloida73rldfcw/southeast-asia/the-philippines-covid-19-helps-a-digital-revolution
Acopiado, Imee Marie & Sarmiento, Jon Marx & Romo, Glory Dee & Acuna, Thaddeus & Traje, A.M. & Wahing, Geraliza. (2022). Digital Payment Adoption during the COVID-19 Pandemic in the Philippines. Philippine Journal of Science. 151. 1185-1196. 10.56899/151.03.31.
George, A., Sunny, P. Why do people continue using mobile wallets? An empirical analysis amid COVID-19 pandemic. J Financ Serv Mark 28, 807–821 (2023). https://doi.org/10.1057/s41264-022-00174-9
FM Contributors. (2023). Leaving Your Wallet Behind: Pros and Cons of Digital Wallets. https://www.financemagnates.com/cryptocurrency/education-centre/leaving-your-wallet-behind-pros-and-cons-of-digital-wallets/
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