ANASTASIA NELEN–UNSPLASH

WISE PHILIPPINES expects transactions coursed through its platform to continue growing as it looks to provide low-cost remittance services and instant international transfers, its top official said.

The global cross-border payments platform entered the Philippine market in May amid the increasing number of freelancers and gig economy workers in the country and the steady growth in remittances and digital payments.

Wise Philippines Country Manager Areson I. Cuevas told BusinessWorld that their main goal is to provide low-cost international fund transfers.

“It’s really about receiving instantly and getting the most money out of what is being sent to them. Of course, we want to support the employers of the freelancers so that their employees in the Philippines could really get the most out of their salaries,” he said.

“And also, the OFWs (overseas Filipino workers). It’s both ways. OFWs will send and the dependents will receive. We want that to be instant, and we want that whatever the OFWs send, there will be as little cost as possible.”

The remittance market is a potential growth area for the company, Mr. Cuevas said.

“If you look at the data by the central bank on inward remittances, that’s $37 billion per year… The aim is to really support a lot of these inward remittances because the more that we support, then the more Filipinos are able to enjoy mid-market rates and lower transaction fees,” he said.

“As we all know, the Philippines is very big on inward remittances, and that’s where Wise could come in with our services,” he added.

Latest data from the Bangko Sentral ng Pilipinas showed that cash remittances grew by 2.9% to $22.22 billion in the January-August period from $21.58 billion a year earlier.

The United States accounted for nearly half or 41.3% of overall remittances in the first eight months. This was followed by Singapore (7%), Saudi Arabia (6.1%), the United Kingdom (4.9%) and Japan (4.8%).

The lack of consumer awareness regarding the fees charged on transactions is both a challenge and opportunity for Wise in terms of customer acquisition, Mr. Cuevas said.

“We really need to educate customers, and that has always been the mission of Wise: to share the cost of hidden markup fees. I think that’s a big friction in how to acquire more customers,” he said. “Wise has been putting out … customer information campaigns on the hidden costs of markups and transparency. Hopefully, more and more Filipinos will realize that okay, there’s this company called Wise, and I should be able to get transfers globally at very low cost and at mid-market exchange rates.”

“There’s a large number of Filipinos who are not aware that their foreign transactions incur a hidden markup, and with Wise you always get mid-market rates, which is what you see on Google. Sometimes Filipinos don’t check what the prevailing mid-market rate is compared to what the provider is giving them, and Wise always offers the mid-market rate,” he added.

Wise Philippines recently gained direct access to real-time electronic fund transfer service InstaPay and the BSP’s gross payment system PhilPaSS Plus, which it expects to result in faster transactions.

Mr. Cuevas said the company is also looking to partner with PESONet, which caters to high-value transactions.

“We cannot say much about that, but it is something that we are looking at. So, hopefully in the future,” he said. “Right now, we want to focus on improving customer experience through InstaPay.”

PESONet and InstaPay are automated clearing houses launched in December 2015 under the central bank’s National Retail Payment System framework.

PESONet caters to high-value transactions and may be considered as an electronic alternative to paper-based checks, while InstaPay is a real-time, low-value electronic fund transfer facility for transactions up to P50,000 and is mostly used for remittances and e-commerce.

The value of transactions done via InstaPay and PESONet jumped by 33.9% year on year to P12.37 trillion as of end-September, latest BSP data showed.

Meanwhile, the combined volume of transactions done via the two payment gateways also surged by 64% year on year to 1.05 billion in the first nine months of the year. — A.M.C. Sy