MANILA, Philippines — Card payments in the Philippines are expected to rise by 17.2 percent to P3.4 trillion this year due to consumers’ shift to other modes of payment, according to data and analytics company GlobalData.
In a report, GlobalData said Philippine card payments are forecasted to grow to P3.4 trillion this year from P2.9 trillion last year.
It said the country’s card payments value registered a compound annual growth rate (CAGR) of 10.5 percent during the period of 2019 to 2023.
“Cash has traditionally been the most popular method of payment among consumers in the Philippines. However, with rising consumer awareness of electronic payments, government’s financial inclusion efforts, availability of low-cost bank accounts and improvement in payment infrastructure, a rise in card payments could be seen over the last few years,” Shivani Gupta, senior banking and payments analyst at GlobalData said.
Between this year and 2028, GlobalData expects the value of card payments in the country to grow at a CAGR of 15.1 percent to reach P6 trillion by 2028.
“The Philippines payment card market is anticipated to continue its growth trajectory with rising consumer spending coupled with government push with initiatives like next phase of 2024-2026 Digital Payments Transformation Roadmap,” Gupta said.
With the central bank’s implementation of the Digital Payments Transformation Roadmap, which aims to convert 50 percent of the total volume of retail payments to digital form and increase financial inclusion by integrating 70 percent of Filipino adults to the formal financial system through payment or transaction accounts, GlobalData said digital transactions in retail payments in the country jumped to 42.1 percent in 2022 from one percent in 2013.
This development benefited card payments as well.
Other financial inclusion initiatives like establishment of smaller bank branches called branch-lite units and employment of micro-banking offices and agents to provide financial services in underserved areas are also supporting card payments growth.
Among the card types, credit and charge cards accounted for 58.5 percent of the overall card payment value in the country last year.
Use of credit cards is increasing due mainly to value-added services such as reward points, installment payment facilities and discounts associated with these cards.
Debit cards, which are traditionally preferred for cash withdrawals, are also now being used for payments, especially for low-to-medium value transactions.