A UNIVERSAL payment ID is being positioned as a possible means of easing the remittance process for Overseas Filipino Workers (OFWs), money transfer solutions firm Ripple said.
“With the Philippines being one of the biggest remittance receiver countries, we definitely see the potential of PayID as a simple and hassle-free solution for OFWs to send money home,” Kelvin Lee, Head of Southeast Asia at Ripple said via e-mail last week.
The Open Payments Coalition, a group of more than 40 organizations, launched PayID in late June. It is being marketed as a multi-channel and multi-currency tool for sending and receiving money.
Mr. Lee said demand in the Philippines for online transactions has been growing steadily since 2018, with the lockdown demonstrating the need for electronic payments (e-payments).
“However, the current payment process is slow and inefficient, and there is a need for a standardized solution…. and PayID aims to facilitate this by breaking down silos in the payment process, unifying a fragmented payments network,” he said.
PayID is a free and open standard technology which banks, payment providers, mobile wallet firms or remittance centers can join.
OFW remittances fuel domestic consumption, which accounts for around 70% of the economy. This year, remittances are expected to drop as the pandemic cripples the global economy.
According to the Bangko Sentral ng Pilipinas, money sent home by OFWs fell 4.7% year on year to $2.397 billion in March. The central bank expects cash remittances to decline by 5% this year.
Mr. Lee said that payments can “work like e-mail” through PayID, with the user having a single address assigned for use in payments or receiving funds.
“This means with PayID implemented, an individual can send HK$500 from their Crypto.com wallet to a friend’s Coins.ph wallet. For businesses, this means being able to offer their customers a single ID that works across any network, thereby increasing their reach to more wallets, currencies and payment platforms,” he said.
He added that using PayID will be convenient for users since they will only need to use simple codenames instead of long and complicated reference numbers or addresses when sending money.
Ripple is among the payments firms that joined the Open Payments Coalition for the universal payment ID, along with Coins.ph, the first Phiippine company in the group.
“With their PayID server, each partner company keeps full control of their PayID domain name and their customer information, and can confidently deploy a server while protecting customer privacy and security,” Mr. Lee added. — Beatrice M. Laforga