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Business

Philippines e-commerce deals to hit P500 billion by 2025

Louise Maureen Simeon - The Philippine Star

MANILA, Philippines — The value of e-commerce transactions in the Philippines is seen hitting nearly P500 billion by 2025 with alternative payment tools expected to drive online activities.

GlobalData, a leading data and analytics company in the UK, said the e-commerce transaction value in the Philippines would likely increase at an annual rate of 15.8 percent from 2022 to 2025.

E-commerce transactions are projected to reach P495.2 billion ($9.7 billion) by 2025 from the nearly P270 billion last year.

GlobalData said alternative payment tools have emerged as mainstream for e-commerce payments in the Philippines, accounting for 31 percent of the total e-commerce value last year.

Mobile and digital wallets have slowly displaced traditional payment methods like cash and cards.

GlobalData senior analyst Nikhil Reddy noted that although “cash on delivery” remains one of the preferred payment methods for Filipinos, alternative payment solutions have surpassed this in the past years.

Reddy said this has been supported by the rising internet and smartphone penetration, growing consumer preference and rising merchant acceptance.

“The pandemic has pushed the adoption of e-commerce payments in the country, as wary consumers increasingly favored online shopping to avoid getting exposed to disease vectors,” Reddy said.

“This has also benefited alternative payment tools, with consumers citing convenience, speed, and reward benefits as key factors,” he said.

GCash, Maya, PayPal and GrabPay have been the leading alternative payment solutions in the country.

Even online shopping platforms such as Shopee and Lazada also offer their own digital payment solutions to take advantage of the growing preference for digital wallet solutions.

Reddy said the government has been taking measures to push electronic payments in the country.

For one, the QR PH program has already been extended to merchant payments, both online and in-store payments, enabling consumers to make interoperable mobile-based payment.

“While alternative payment tools lead the Philippines e-commerce payment space, they are also now increasingly being used for in-store payments. With the growing adoption of QR code-based solutions among merchants and government initiatives to push electronic payments, alternative payments are poised to disrupt the country’s overall consumer payments space,” Reddy said.

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