Facebook Instagram Linkedin X Youtube
Home Blog Page 8664

Jobs recovery plan highights safe workplaces, confidence, small-business loans

The labor department said its recovery blueprint for employment will enlist multiple government agencies to bring about safer workplaces, improved business and consumer confidence, and the extension of credit to small businesses.

The three-year “whole-of-government” plan is launching this year to address unemployment in the wake of the coronavirus pandemic, Labor Assistant Secretary Dominique R. Tutay said Friday.

The blueprint is known as the National Employment Recovery Strategy (NERS), which the government hopes will support legitimate employment and entrepreneurship in the “new normal,” she said at a televised briefing.

Ms. Tutay said the Department of Labor and Employment (DoE) is preparing the recovery plan with the Department of Trade and Industry (DTI) and the Technical Education and Skills Development Authority (TESDA). Various other agencies were also consulted in the course of drafting the plan.

The top piority is the “safe re-opening” of business establishments as well as the safety of workers and consumers, Ms. Tutay said. “Second on the list is the restoration of business confidence, consumer protection,” she said. The program will also offer “reboot packages” or extend low interest-rate business loans to micro, small, and medium enterprises to help them recover from the pandemic.

The program also aims to upskill the workforce, particularly in digital skills, she said.

Ms. Tutay said the government is hoping that the Build, Build, Build infrastructure program and the Balik Probinsya program help restore economic activity in the countryside.

Some 420,000 workers were permanently displaced by the coronavirus pandemic, she said, arising from the adoption of more flexible work arrangements or alternative work scheme, or have closed temporarily.

She said jobs in health care, construction and business process outsourcing are the most in demand. — Kyle Aristophere T. Atienza

CREATE needs to pass in Jan. for firms to realize tax benefits by April filing – DoF

FINANCE Secretary Carlos G. Dominguez III said the bill lowering corporate income taxes needs to get past the bicameral conference committee by the end of January to allow enough time for companies to file their returns in April with the new rates, some of which apply retroactively to the second half of 2020.

“We hope that the Congress can pass CREATE before the end of January 2021 as this measure is crucial for businesses to continue operating, retain their employees, and create more jobs,” Mr. Dominguez said in a statement on Friday.

Both chambers of Congress took a month-long break on Dec. 19 for the holidays, and will resume regular session on Jan. 18.

The Corporate Recovery and Tax Incentives for Enterprises Act (CREATE) bill forms part of the government’s economic recovery package, featuring a scheme to reduce the corporate income tax rate to 25% effective July 2020, from 30% currently, while streamlining tax incentives to make them more time-bound and performance-based.

“This also provides taxpayers ample time to comply with adjustments to their returns due to the lowering of income taxes effective July 2020 before the tax filing season ends in April 2021,” Mr. Dominguez added.

The measure is expected to cost the government P251 billion in foregone revenue over two years – P133.2 billion this year and P117.6 billion in 2022, if the Senate version prevails in bicam session.

Senate Bill 1357 also provides an outright reduction of corporate income tax for small businesses to 20% starting July 2020 from 30% currently, while all other companies will have their tax rates gradually trimmed by one percentage point each year from 2023 to 2027 until the rate hits 20%.

The House of Representatives approved its version, House Bill 4157, in September 2019, when the measure was still known as the Corporate Income Tax and Incentives Rationalization Act (CITIRA). It was since repositioned as an economic recovery measure during the pandemic.

“CREATE is really about trusting the private sector. Instead of passing funds through what tend to be less efficient government programs, this will leave the money in the private sector’s hands to revitalize their businesses,” Mr. Dominguez said.

Mr. Dominguez said the economic team also hopes lawmakers can pass within the year two more tax reform measures covering the property valuation system and the taxation of passive income and financial intermediaries. — Beatrice M. Laforga

Meralco to increase power rates in January

Residential customers in Metro Manila will be charged more for power in January, with the typical household expected to pay an additional P55, Manila Electric Co. (Meralco) said Friday, citing higher generation charges.

In a statement, Meralco said that the January electricity rate is up P0.2744 per kiloWatt-hour (kWh) compared to its December level.

“Despite the increase, this month’s overall rate is still more than P0.70 per kWh lower than January 2020’s rate of P9.4523 per kWh,” Meralco said.

The utility said the typical household is one consuming 200 kWh. Households consuming 300 kWh, 400 kWh, and 500 kWh will see bill increases of P82, P110 and P137, respectively.

The generation charge rose P0.2058 to P4.4574 per kWh in January. Meralco attributed the rise to power supply agreement (PSA) and independent power producer (IPP) rates which increased by P0.2723 per kWh and P0.2428 per kWh, respectively.

PSA-sourced power accounts for 56.4% of Meralco’s energy requirements while IPPs are responsible for 37.3 %.

Meralco said PSA and IPP rates rose because Luzon’s peak demand fell by 252 megawatts (MW) in December due to reduced consumption as a result of colder temeperatures and the holidays.

“Similarly, the demand for power in Meralco’s franchise area in December fell to its lowest level since lifting of the ECQ (enhanced community quarantine) in May. Lower demand led to fixed costs from power suppliers being spread over lower energy volume, resulting in higher effective generation rates to consumers,” Meralco said.

Meanwhile, rates at the wholesale electricity spot market (WESM) – which accounted for 6.3% of Meralco’s energy requirement – decreased by P0.6135 per kWh.

Transmission charges for residential customers decreased by P0.0236 per kWh due to Meralco’s mandatory refund of transmission over-recoveries as directed by the Energy Regulatory Commission. Taxes and other charges were also reduced by P0.0078 per kWh.

On Dec. 29, the regulator approved the collection of a feed-in tariff allowance (FIT-All) of P0.0983 per kWh which would take effect in the next billing cycle. This led to an increase of P0.0488 per kWh in Meralco’s FIT-All this month.

Meralco said that the collection of the universal charge-environmental charge of P0.0025 per kWh remained suspended, as directed by the ERC.

Meralco’s distribution, supply and metering charges remained unchanged for 66 months, after implementing the registered reduction in July 2015.

Meralco reiterated that it did not earn from pass-through charges, such as the generation and transmission charges.

“Payment for the generation charge goes to the power suppliers, while payment for the transmission charge goes to the NGCP (National Grid Corp. of the Philippines). Taxes and other public policy charges like the Universal Charges and the FIT-All are remitted to the government,” Meralco said.

Meralco’s controlling stakeholder, Beacon Electric Asset Holdings, Inc., is partly owned by PLDT, Inc. Hastings Holdings, Inc., a unit of PLDT Beneficial Trust Fund subsidiary MediaQuest Holdings, Inc., holds an interest in BusinessWorld through the Philippine Star Group, which it controls. — Angelica Y. Yang

Pork prices rise as hog raisers scale back production due to ASF

THE rise of pork retail prices in Metro Manila was caused by a scaling back of production by commercial hog raisers due to the spread of African Swine Fever (ASF), an industry official said.

In a radio interview Friday, Nicanor M. Briones, Vice President for Luzon of the Pork Producers Federation of the Philippines, Inc. (ProPork). said Luzon is experiencing a shortage after most backyard and commercial hog raisers voluntarily cut back on their operations out of fear their animals will contract ASF.

“You will go bankrupt if you are affected by ASF since there is no cure yet. Also there is no budget from the Department of Agriculture (DA) to assist hog raisers,” Mr. Briones said.

Mr. Briones said the hog population of Luzon is around 7.5 million head, with 4 to 5 million of this total lost to ASF or to culls ordered to quarantine the disease.
“Some 4 to 5 million head were lost from the 7.5 million hog population,” Mr. Briones said.

According to the DA’s Jan. 8 price monitoring report, the price of pork shoulder, known as kasim, ranges from P320 to P380, while pork belly, or liempo, fetched between P340 and P420 per kilogram. The report took in prices at various wet markets in Metro Manila.

The DA’s suggested retail price (SRP for pork shoulder is P260 per kilogram, and pork belly P290 per kilogram, well below actual market prices.

In the same radio interview, DA Spokesman Noel O. Reyes said P1 billion has been allocated to indemnify hog raisers that were affected by ASF.

Mr. Reyes said a process has to be followed before funds are released. Part of the process is for hog raisers to show that their animals died because of ASF.

“If a raiser’s pig died or is sick, a blood sample has to be extracted to ascertain if it was caused by ASF or not. There is a process to indemnification,” Mr. Reyes said.

“More than 80% of the P1 billion funds have already been released. Most of which were given in Luzon,” he added.

Mr. Reyes said the DA has been urging hog raisers in Visayas and Mindanao to deliver pork to Luzon.

He said that in 2020, around 200,000 hogs were transported to Luzon in an effort to boost pork supply.

Mr. Reyes also urged hog traders to lower their mark-up in order to bring downretail prices.

DA Assistant Secretary Kristine Y. Evangelista said in a Laging Handa briefing Friday that the retail price of pork has also risen because some growers shut down operations in the early stages of the pandemic and have not reopened since.

The ASF outbreak was first detected in provinces around Metro Manila in 2019. — Revin Mikhael D. Ochave

MARINA lifts freeze on accrediting maritime training courses, assessment centers

The Maritime Industry Authority (MARINA) said it lifted the moratorium on the accreditation of maritime training courses and assessment centers.

MARINA Administrator Robert A. Empedrad, in an advisory issued on Jan. 7, said the end of the moratorium was intended to bring about “fair and just competition in the delivery and conduct of training and assessment for Filipino seafarers.”

The moratorium covering training courses was issued in 2017 “in line with the proposed shift to the new rules and regulations in the accreditation of maritime training institutions, approval of courses and adoption of standards of mandatory training,” MARINA said.

In 2018, MARINA also suspended the acceptance of applications to accredit assessment centers, citing a review and revision of the rules and regulations for the process.

“MARINA assures the public that it continuously commits to produce globally competitive seafarers by maintaining the quality of maritime education and training in the country despite the rising number of confirmed cases of COVID-19,” the agency said. — Arjay L. Balinbin

ERC case rulings rise 21% in 2020 after adoption of video hearings, electronic filing

The Energy Regulatory Commission (ERC) said Friday that the number of cases it concluded in 2020 rose 21%, aided by the adoption of videoconferencing for its hearings.

In a statement, the ERC said it wrapped up 748 cases in 2020, compared to 617 in 2019. The commission said it also issued more orders, decisions, resolutions, notices, and certificates of approval and authority last year.

“The ERC continued to conduct hearings and conferences through virtual platforms to complete the legal proceedings that it should perform as part of its quasi-judicial functions,” the commission said in a statement.

Last year, the commission issued orders and advisories covering 10 rate reduction schemes, including the reduction in the system loss cap, which was lowered by P0.05 per kilowatt-hour (kWh); the refund of the over-recoveries of 64 distribution utilities (DUs) that amounted to P3.3 billion; and the lowering of the retail competition and open access threshold, among others.

In May, the ERC ordered DUs to allow their customers consuming 200 kWh and below in February to pay their power bills on a staggered basis of up to 6 equal monthly installments during the government-imposed lockdown – without penalty, interest or other fees.

The agency had implemented the “Amended guidelines on electronic applications, filings and virtual hearings before the ERC” to govern electronic transactions.

“The Commission has embraced the ‘New Normal’ and we are thankful that online platforms abound to be explored and utilized to the fullest. We were surprised and happy to note that this pandemic even provided us the opportunity to optimize the use of digital technologies to continuously perform and deliver our mandate,” ERC chairperson and chief executive officer Agnes VST Devanadera said. — Angelica Y. Yang

Fast track sought for measure closing POGO tax loophole

THE House of Representatives needs to fast-track a measure closing a loophole in a tax law authorizing the collection of a 5% franchise tax from Philippine Offshore Gaming Operators (POGOs), a senior legislator said.

Representative Jose Maria Clemente S. Salceda of Albay issued the statement after the Supreme Court granted the petition of 14 foreign-based POGOs to prevent the Bureau of Internal Revenue (BIR) and the Department of Finance from collecting the franchise taxes from POGOs, as outlined in Republic Act No. 11494 or the Bayanihan to Recover as One Act (Bayanihan II). The tax would have raised billions in additional revenue to boost the treasury for pandemic measures.

“They can’t say they are Chinese operations, because gambling is illegal in China. They are Philippine operations. And my bill closes the ambiguity by stating in black and white that they are in fact doing business in the Philippines,” he said in a statement.

Mr. Salceda, chairman of the House committee on ways and means, last year filed House Bill No. 5257, which seeks to impose a 5% franchise tax on all POGOs on gross receipts derived from gaming operations.

The measure also proposes a 25% withholding tax on foreign POGO workers with a minimum threshold of P600,000 per annum. The proposed tax rates would raise a total of P45 billion for the national government, Mr. Salceda said.

The proposed legislation should “sail smoothly” this month since the two chambers of Congress “both agreed on the POGO taxes in Bayanihan II,” Mr. Salceda said.

“My bill would make it a case of tax evasion to (neglect) reportorial requirements. There’s a very thin case for slapping POGOs with tax evasion in the current law.”

The BIR earlier reported that only 10 out of 60 licensed POGOs in the country paid tax. The Philippine Amusement and Gaming Corporation (PAGCOR) in mid-June last year confirmed that some POGO firms have left the Philippines due to the government’s restrictions on the industry and the impact of the coronavirus pandemic on business activity.

The gaming regulator has been pushing for the resumption of POGO operations during the quarantine. — Kyle Aristophere T. Atienza

Banks see wholesale/retail recovering fastest among hard-hit industries

Bankers said wholesale/retail will recover the fastest among the industries most heavily affected by the lockdown, while accommodation services and transport could take up to two years, according to a survey conducted by the Bangko Sentral ng Pilipinas (BSP) in the second half of 2020.

The BSP’s Banking Sector Outlook Survey (BSOS) also showed a consensus held by 65% of those surveyed that overall growth in the next two years could drop below 6% in the worst case, with 6.3% the other end of the range. This view represents a slight softening from the year-earlier survey consensus of 6-6.3%.

“Banks observed that the wholesale and retail trade sectors will be the fastest to recover in the next six months to one year. Transportation sector will take the longest time of about two years, while accommodation sector will take around one to two years to fully recover,” according to the survey findings, issued Friday.

The survey found that 68.8% of those surveyed expect the domestic banking system to be stable in 2021-2022, while a minority of 25%, mainly foreign lenders, expect a strong rebound during the period.

In the year-earlier survey, only 0.8% of respondents expected the banking system to strengthen over the near term.

“Banks’ positive economic outlook translated to renewed confidence in the stability of the banking system… The news of a high efficacy (more than 90%) of the COVID-19 vaccines, being developed and soon to be rolled out by leading pharmaceutical and biotechnology companies, partly buoyed banks’ risk-on sentiment,” it said.

The survey asked presidents, chief executive officers and country managers of universal, commercial, thrift, rural and cooperative banks about their outlook on the banking industry and the overall economy, considering the impact of the pandemic. The latest BSOS was the fourth since its launch in October 2018.

Around 60% of the respondents said they expect double-digit growth in their assets due to the prospects for an economic recovery, less than the 70% in the previous survey.

Some 71% of the banks also projected double-digit growth in their loan portfolio and deposits over the next two years.

Around 70% of lenders also expect net income to increase in the double digits, less than the 80% in the 2019 survey.

Estimates for return on equity were subdued, with 33% of bankers projecting less than 5%, compared to 11.3% previously.

“The slowdown in economic activities may have exerted pressure on the quality of bank loan portfolios. This could be seen in the increase of respondents expecting the ratio of non-performing loans (NPL) to total loans to exceed 3% in the next two years to 81.3% (of respondents) during the second semester of 2020 from the 67.4% in the previous survey,” the BSP said.

The central bank also surveyed the bankers on their projections for volume of restructured loans relative to their total loan portfolio, a new indicator included in the survey to measure the “propensity of banks to modify the terms of the loan when borrower is facing financial stress due to unforeseen events like the COVID-19 pandemic and natural disasters.”

It said 54.4% of the banks, mostly thrift banks, foreign banks, and rural and cooperative banks, estimated a restructured-loan ratio of 3% to more than 5% in the next two years, while 39%, mainly universal and commercial lenders, gave a range of less than 1% to 3%.

The survey also found that 49% of the respondents expect their NPL coverage ratio to hit 25-50% while 44.3% gave an estimate of 51-100%.

“In terms of products or services, the majority of the heads of banks mentioned that corporate and retail banking will be their top most priorities, followed by payments and settlement services, cross-selling, and trade financing,” the central bank said.

It added the top two strategic priorities of the banking sector are to grow their businesses and maximize the growth potential offered by technology. — Beatrice M. Laforga

Company leaders should embrace ‘infinite mindset’ and share their struggles — motivational speaker

“Ask for help and be there for others,” said Simon Sinek, author and motivational speaker, in his first blog post for 2021, which listed the silver linings and lessons that came out of 2020. “No one has the emotional strength to avoid the pain of trauma, and the way COVID-19 turned lives upside down is a trauma,” Mr. Sinek’s post continued.

The sentiment was a throwback to a talk in which Mr. Sinek—a person described as an unshakeable optimist—shared that he was not impervious to the trauma caused by the pandemic. 

At the Adobe Experience Makers 2020 event, he recounted that he began feeling off his game four months into the pandemic: His sleep pattern was disrupted, he didn’t want to get out of bed, and he started having one unproductive day after another. 

“I had to come to the realization that I was depressed,” Mr. Sinek said. “I was very uncomfortable with that word because it sounds like a diagnosis with a capital D.” He followed the advice of his friend in the military and faced his trauma by asking for help instead of avoiding it. “Though you may not be feeling it now, 100% of us have gone through trauma—which means that 100% of us are going to have to deal with the emotional cost of this trauma at some point.” 

It is important for everyone, he added, especially for leaders, to recognize when they are suffering through trauma and to be open about it. Being seen as a perpetual optimist can backfire, said Mr. Sinek, because other team members may feel like they’re doing something wrong.

Recognizing that everyone is going to go through trauma also leads to greater empathy across the board, which in turn makes it easier to offer help when needed.

PLAYING THE INFINITE GAME

At an organizational level, adopting an infinite mindset that also realizes that people are at the center of business will help leaders get through the other side of COVID-19. The mindset is based on theologian James Carse’s idea of finite versus infinite games. 

According to Mr. Carse, a finite game has known players, fixed rules, and is played for the purpose of winning. An infinite game, on the other hand, has both known and unknown players, changeable rules, and is played for the purpose of continuing the play.

From education to career, life is a series of infinite games, said Mr. Carse. A business likewise isn’t about beating the competition or being number one. It’s about staying in the game as long as you can, recognizing that your one true competitor is yourself, and improving year after year.

“We have ahead moments and behind moments, but we’ll never win or lose unless we fall out of the game,” said Mr. Sinek. “When the crisis hit, a total of zero companies woke up in the morning with an attempt to beat their competition. It literally didn’t matter anymore. Everybody woke up trying to stay in the game.”

HAVING A JUST CAUSE 

A crisis reveals the strengths and weaknesses of certain facets such as culture and leadership. It also reveals which mindset a company has. Those with a finite mindset, according to Mr. Sinek, tend to panic because all thinking happens in the past. These companies put themselves at the center of the equation and ask, “How are we going to survive? How are we going to make money?” 

Infinite-minded companies, meanwhile, are those that embrace uncertainty and pivot to address present challenges. They are customer-focused and say, “We have something valuable that people want. We have to find new ways to deliver.”

The motivational speaker added that having a just cause gives people a North Star, something to look towards and innovate against. Having a sense of purpose will allow a company to focus on the light at the end of the tunnel, a.k.a. the direction that matters. “That’s essential for driving innovation. We don’t want to innovate in every direction.” — Patricia B. Mirasol 

Peso weakens as new coronavirus cases spike

The peso closed weaker Friday after the Health department reported a larger-than-usual group of new coronavirus infections on the day, about a week removed from the New Year’s celebrations and the accompanying large gatherings.

The peso weakened to P48.088 to the dollar, against its P48.07 finish on Thursday and P48.023 a week earlier, on Dec. 29, the last trading day of 2020, according to data from the Bankers Association of the Philippines.

The peso opened at P48.12, its low for the session. The high was P48.045.

Dollar volume on Friday was $727.37 million, up from $518.45 million Thursday.

In a Viber message, Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort attributed the peso’s depreciation to the COVID-19 case count and higher oil prices.

The Department of Health reported on Friday 1,776 new coronavirus infections, bringing the total case tally to 483,852. Eight new deaths were recorded and 285 recoveries.

“The peso also weakened… as the seasonal increase in remittances and conversion to pesos during the Christmas and New Year holiday season is over and done with,” he added.

Mr. Ricafort said crude oil prices rising to more than $50 per barrel, possibly leading to a higher oil import bill, increasing demand for dollars to pay for the imports.

“The peso also weakened after the benchmark 10-year US government bond yield reached a new 9.5-month high of 1.08%, sharply up from a low of 0.50% on August 6, 2020, thereby increasing the interest rate returns of dollar-denominated bonds,” he said.

The trader attributed the dollar’s strength to the US non-manufacturing and initial jobless claims reports.

The number of US citizens filing claims for jobless benefits for the first time fell to 787,000 last week from 790,000 the week prior, according to Reuters. The volume of claims was lower than the consensus of 800,000 from economists polled by Reuters. — Beatrice M. Laforga

Local shares end higher as US Congress confirms Biden’s win

Philippine stocks closed higher on Friday as investor sentiment took cues from markets abroad after the US Congress affirmed the win of President-elect Joseph “Joe” R. Biden, Jr. The bellwether Philippine Stock Exchange index (PSEi) climbed 170.27 points or 2.39% to end at 7,289.88. The broader all-shares index also improved, by 82.78 points or 1.94% to 4,354.27.

“Philippine shares surged after Congress confirmed President-elect Joe Biden’s election win, offering the prospect of more financial aid for consumers and businesses coping with the coronavirus pandemic,” Regina Capital Development Corp. Managing Director Luis A. Limlingan said on Viber.

Philstocks financial, Inc. Senior Research Analyst Japhet Louis O. Tantiangco said in a text message that the local market rallied on Friday as it tracked Wall Street’s “record-high performance over night.”

“This comes as the Democratic party takes control of the US congress while Joseph Biden’s election as President gets confirmed, raising prospects for further US fiscal stimulus,” he said. AAA Securities Research Head Christopher John Mangun said that the benchmark index ended the day with substantial gains led by blue chip banks.

“The general sentiment improved as investors took cues from markets abroad. US indexes continue to hit new all-time highs, showing investor confidence despite the recent political upheaval. Even China’s main index hit its highest level since 2008,” Mr. Mangun told BusinessWorld in an email interview.

He said the market’s performance on Friday allowed the PSEi to end the first week of the year with gains, despite the “heavy selldown” at the start of the week.

“This is the highest level that the main index has ended at since February of last year. Overall, investors remain confident with the current conditions and are willing to stay in the market for the longer term,” Mr. Mangun said.

US stocks in the Dow Jones Industrial Average, S & P 500, Nasdaq composite, New York Stock Exchange composite and S&P/TSX composite all rose on Friday.

Majority of Asian stocks, except for the CSI 300 index, also logged positive gains for the day. Back home, the majority of the sectoral indices ended Friday’s session with gains. Holding firms grew 152.69 points or 2.10% to 7,422.45; industrials edged up 129.85 points or 1.37% to 9,592; property improved 99.97 points or 2.71% to 3,785.02; financials climbed 47.90 points or 3.33% to 1,487.37; and services inched up 24.07 points or 1.59% to 1,540.28.

Mining and oil, however, decreased 63.32 points or 0.63% to close at 9,989.59.

Advancers led decliners, 141 vs. 74, with 48 left unchanged.

Value turnover stood at P11.06 billion with 25.13 billion issues switching hands, lower than the previous session’s P8.73 billion with 46.43 billion issues.

Net foreign buying reached P223.78 million from the net P680.38 million that left the market on Thursday.

For Trading Edge Consultancy’s Chief Investment Strategist Ron Acoba, bargain-hunting activities made stocks rally.

“Bargain hunting activities after the PSEi pulled back from its 10-month high of 7,304 to an interim low of 6,928 has led the index to rally. Regionally, the PSEi has actually just tracked its peers following a new record setting in the US equities markets as investors hope for further fiscal stimulus,” Mr. Acoba told BusinessWorld in an e-mail.

He said that he expects the PSEi index to consolidate below its key resistance at the 7,300- 7500 zone.

“Nonetheless, its earlier swing from a midrun base is ultimately setting it up to revisit its 2019 levels perhaps in the second half of the year,” he said.

Meeting Filipinos’ financial needs during the pandemic

Beyond cashless payments and transactions, GCash widens access to various financial services

From taking its initial steps, the adoption of cashless payments and transactions has taken full speed due to the coronavirus disease 2019 (COVID-19) pandemic. Now, as more consumers use digital financial services to transact safely and efficiently, GCash has taken the lead to bring in more Filipinos towards the benefits and conveniences of going cashless.

During an online forum in the World Fintech Festival Martha Sazon, president and chief executive officer of Mynt, the operator of GCash and chairman of the EMoney Association of the Philippines, shared that this year saw the financial service getting closer to realizing its vision of ‘finance for all’.

“People who have never thought of using cashless payments before suddenly [learned to use it], resulting in massive registrations. In response, we empowered them to transact using their mobile [to] pay for essentials and bills, and even receive aid from the government on a convenient and safe platform,” Ms. Sazon said.

She pointed out that GCash responded to the shifts in consumer behavior caused by the quarantines several months ago. With the pandemic raising the trend for e-commerce, virtual communities, and navigating through financial stability, Ms. Sazon continued, GCash served as a safe and convenient platform for social sellers, finance-conscious individuals, and at-home consumers to transact, receive, and even maximize their money.

As the Mynt CEO shared, GCash has empowered at least 500,000 social sellers on their P2P (person-to-person) platform. Over PHP 1 trillion in transactions have passed through the GCash app during 2020, peaking at a PHP 7.5 billion daily gross transaction value, and with more than 6 million transactions in a day. The mobile wallet company also grew its users to 33 million, a 65% growth versus last year.

GCash has also played a significant part in sustaining the economy amid COVID-19’s disruptions, characterized by a record-low 6.9% drop in gross domestic product, 10% unemployment rate, and 26% of micro, small, and medium enterprises closed during the lockdown.

“With this, we see GCash playing a key role in keeping the economy moving and helping businesses and livelihoods. We’ve helped them thrive amidst the crisis,” Ms. Sazon shared. Latest figures show that there are about 500,000 social merchants to date in the P2P network, with more than 11,000 merchants added during the ECQ.

Beyond payments and transactions

As it strives to remain relevant amid the pandemic, GCash has become the leading finance application. Ms. Sazon attributes this to the app’s services that are tailored to meet consumer’s various needs. More than enabling everyday payments and transfers, GCash offers a wide range of accessible financial services. GSave, for instance, enables users to open and maintain a bank account straight from the GCash app for 3.1% interest and without any minimum amount. This December, GSave offers up to 4% per annum for accounts that maintain a balance of P100,000.

Functioning like a flexible loan or credit card, GCredit enables users to have their own personal revolving credit line in GCash, which they can use any time they want. GInsure, meanwhile, helps GCash customers access insurance products that give cash assistance and medical coverage. In partnership with Singlife, GInsure offers a medical coverage for dengue and COVID-19 costs for as low as Php300/year.

“As we become more relevant, we are the undisputed leader in terms of active users,” Ms. Sazon added. “GCash has surpassed Twitter and Grab in July, and in August we have overtaken Netflix. This just goes to show that we have become a part of everyday lives of Filipinos.”

In addition to its financial services, GCash has recently introduced GLife, an all-in-one digital lifestyle platform for convenient access to several brands. Also accessible via the GCash app, GLife enables users to shop, eat, and play without having to download multiple apps. GCash’s partners that are included in GLife are Lazada, Puregold, Goama games, Globe ONE, Kitchen City, Zeal Rewards, and American Express.

Aside from serving as a safe and convenient e-payments platform for merchants and consumers, GCash has become a lifeline to many Filipinos. It became a partner of the government in disbursing aid to many Filipinos through the Social Amelioration Program, distributing P16 billion to two million Filipinos in Makati, Quezon City, and Taguig.

GCash has also become a channel for many Filipinos to donate for relief efforts during Typhoons Rolly, Siony, and Ulysses. With a big boost from celebrities and non-government organizations, GCash was able to collect P21 million for relief efforts.

All these achievements during this year show that GCash has been at the forefront of bringing Filipinos towards adopting cashless payments.

Ms. Sazon emphasized that as GCash continues to play its role in accelerating cashless payments among consumers, it looks forward to collaborating with fellow players in amplifying financial inclusion. “We all need to work together. There’s no single entity that can do that. Even with GCash, with all our success, we cannot do it alone,” she said.

1...8,6638,6648,665...14,272Page 8,664 of 14,272
ADVERTISEMENT
ADVERTISEMENT
© 2024 BusinessWorld Publishing.
All rights reserved.
Read our privacy guidelines
Facebook Instagram Linkedin X Youtube