REMITTANCES from overseas Filipino workers (OFWs) are driving the use of app-based digital payments, according to a report by Visa.
The report showed there was a high frequency of sending and receiving remittances among Filipinos, as 48% of Filipino respondents said they send money internationally at least once per month, while 77% said they receive money a few times a year.
More than half or 57% of Filipino respondents also said they intend to use digital platforms for remittances more often in the future.
“Remittance habits are also changing with ease of use and better technology — we are seeing remittances being sent and received in less than a day in Asia Pacific, spurring increased frequencies,” Visa Asia-Pacific Head of New Payment Flows T.R. Ramachandran said in a statement.
“Beyond livelihoods, we are also seeing more remittances made in support of key life milestones, such as funding college education, making investments for the long term, or saving for an overseas property purchase,” Mr. Ramachandran said.
While a number of remittance users are using digital platforms, Filipino respondents said they were generally open to it, as they see these as a secure way to send and receive money.
The report showed that majority or 71% of Filipino respondents said they adopted app-based solutions to receive funds from OFWs.
Filipinos surveyed also said they primarily receive remittances (70%) rather than sending (17%), Visa said.
It also showed that female OFWs send money earned from their jobs in domestic work or healthcare industries, remitting just as much as their male counterparts.
“Fast, easy and secure payments can make a profound difference to families, communities, and economies around the world,” Mr. Ramachandran said.
“This new research shows incredible acceleration of digital payments and how consumer expectations of speed and ease of use is underpinned by the demand for better security,” he added.
However, Visa said in the report that high fees and issues with calculating the exchange rate remain pain points in the adoption of app-based digital remittance for the broader Asia-Pacfic.
“Almost all physical surveyed remittance users report at least one issue, such as speed, convenience, and a confusing/difficult process,” Visa said.
It said that remittances are not just a lifeline for everyday needs, but also a key economic driver in the Philippines, with remittances contributing an estimated 9.3% in gross domestic product in 2021, according to data from the Philippine Statistics Authority.
The central bank wants 50% of total retail transactions done digitally and to bring at least 70% of Filipino adults into the financial system by this year under its Digital Payments Transformation Roadmap. — A.M.C. Sy