The COVID-19 pandemic fueled digital payments in the Philippines, where online transactions surged by as much as 5000% over the last year.
In response to this growth, the Bangko Sentral ng Pilipinas (BSP), the country’s central bank, launched the QR PH person-to-merchant (P2M) system that uses QR codes for financial transactions.
QR PH P2M utilizes one of two electronic payment facilities approved by the Philippine central bank’s National Retail Payment System (NRPS). The QR code is helpful for small businesses since it is less expensive than employing a POS terminal.
“To receive payments, merchants only need to print QR codes, which the respective payments service provider will generate for them, display those codes, and obtain payments by simply asking their customers to scan the code without necessarily getting connected to the internet. Confirmation of successful payments transactions may also be received by both the merchants and the customers,” said Benjamin Diokno, Governor, BSP.
As a result of this new system, the use of QR codes for payments is expected to rise, resulting in even more electronic or online transactions.
In fact, the country’s Department of Trade and Industry (DTI) reports that as of 2020, 952,969 or 99.51% of the country’s businesses are micro, small, and medium enterprises (MSME). Over the last year, many of these businesses had to switch to online platforms like Gcash and Paymaya to receive payments.
Furthermore, according to Statista, around two-thirds of the population, or about 73.9 million Filipinos, have access to the internet via mobile devices. “This suggests that, in general, more Filipino consumers and merchants nowadays have the means to use digital payment facilities to send and receive payments, including those made through QR-enabled instruments,” he said.
BSP launched the QR PH program in November 2019 to make person-to-person payments easier. So far, the initiative has focused on remittances and financial transactions in the information industry. With the P2M program in place, BSP hopes to accelerate the digital economy post-COVID.