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Filipinos shift to e-payments, online banking amid lockdown

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By Luz Wendy T. Noble, Reporter

BANKS and payment firms have seen a surge in online transactions amid the enhanced community quarantine (ECQ) in Luzon.

During the lockdown, lenders said they observed a rise in account openings as well as fund transfers as limited businesses maintained physical working hours, including banks.

Just two weeks after the lockdown started, Bank of the Philippine Islands (BPI) observed a more than 25% increase in retail digital transactions which included interbank transfers, transactions with e-commerce partners, as well as bills payments, the lender said in a statement.

Interbank transactions made through InstaPay increased 50% to 300,000 from pre-quarantine levels, according to BPI Chief Digital Officer Noel A. Santiago.

“In the last two weeks of March, BPI, through its retail digital platforms, facilitated more than 1.5M transactions with a total value of close to P8 billion,” Mr. Santiago said in a statement.

The internet has become a crucial tool for clients during the ECQ period, according to Philippine National Bank (PNB) President and Chief Executive Officer Jose Arnulfo A. Veloso.

“The lockdown has made clients realize the importance of mobile banking applications for their transactions. The use of Internet has become more crucial than ever,” Mr. Veloso said in a statement to BusinessWorld.

According to Mr. Veloso, clients who have enrolled their accounts for mobile banking increased 14% from March 16 to April 7 versus average levels before the lockdown.

He also noted that there was a 13% increase in financial transactions, including fund transfers.

Mr. Veloso said that the current situation has pushed PNB to convert more passbook customers to automated teller machines (ATM) and to enrol them in online banking.

“We are also getting more online merchants [to] get PNB accredited to allow our customers to transact with more companies,” he said.

The rise in online transactions came as Filipinos need cash amid the lockdown, Rizal Commercial Banking Corp. (RCBC) said.

“With the restricted mobility allowed to the public and the limited operation of bank branches, there is little option but to turn to digital products,” Angelito Lito M. Villanueva, RCBC executive vice-president and chief innovation and inclusion officer, said in a text message.

He said RCBC’s send cash feature, which allows clients to transmit cash to unbanked recipients, also saw a 156% surge in transactions as of end-March compared to pre-ECQ levels.

“The marked increase indicates the need for more liquidity during this difficult time,” Mr. Villanueva said.

UnionBank of the Philippines, Inc. also observed growth in digital transactions during the ECQ.

“For the month of March, UnionBank logged a nearly 160% [growth] in daily sign-ups to its online and mobile banking portals, and enabled more than 500,000 credit card transactions and well over 1 million Instapay and PesoNet fund transfer transactions,” the bank said in a statement.

CASH-HEAVY SEGMENTS TURN TO E-PAYMENTS
Previously cash-heavy segments related to basic necessities recorded a rise in digital transactions in the past weeks, said Shailesh Baidwan, president of digital payments firm PayMaya Philippines, Inc.

Moreover, Mr. Baidwan said they have observed more small businesses and freelancers using the PayMaya app for transactions with clients during the lockdown.

“Digital payment transactions with pharmaceuticals posted the biggest month-on-month growth in March from February. We also observe consistent growth in certain retail segments such as groceries,” Mr. Baidwan said in an e-mailed response to BusinessWorld.

Meanwhile, transaction volumes related to travel, hospitality and tourism edged lower due to restrictions meant to contain the virus outbreak.

The platform, he said, has also been tapped by micro, small and medium enterprises (MSMEs) that sought to continue delivering their services amid the temporary shutdown of their regular operations.

“Brick and mortar restaurants, smaller online food specialty stores, fresh and frozen produce suppliers and the like are now offering online ordering and deliveries,” he said.

Likewise, Mr. Baidwan said freelancers and professionals have been creating PayMaya accounts to accept payments digitally.

Meanwhile, CIMB Bank Philippines initially saw a decline in new account enrolments at the onset of the lockdown, but this has since rebounded.

“Our acquisition for new customers continues to be healthy after a momentary dip immediately after the implementation of the Luzon-wide ECQ. Now we are back to our pre-ECQ numbers,” CIMB Bank Philippines Chief Executive Officer Vijay Manoharan told BusinessWorld in a statement.

Mr. Manoharan said the ECQ has made Filipinos more inclined to try online banking.

“This will hopefully pave the way for more Filipinos to transition into all-digital banking solutions,” he said.





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