What’s up with the Philippines and Cashless Economy?

The Asian countries have exhibited tremendous economic growth in the past few years. While China and India make the icing on the cake, Philippines is right around the corner. As the country’s economy grows, adoption of latest technology in the economic sector should also grow hand-in-hand. In order to keep up with the technological advancements, while ensuring the benefit of the masses, the country is slowly inching towards a cashless society.

The country’s socio-economic conditions are also paying a huge role in laying out the path for development. For a country that is improving at a rapid pace, it has a large section of the unbanked and underbanked population. These people do not have access to conventional financial services. They may not even know how to operate a bank account, but they have smartphones and they know very well how to use them. This has led to an increased adoption of mobile money as an alternative financial system. With mobile money, people can pay their bills, buy goods from shops and more. Recently, the Philippines Bureau of Internal Revenue tied up with Globe Telecom, the second largest telecom provider in the country to allow people to pay their taxes using mobile money.

The use of mobile money is not a new concept. Safaricom’s MPesa, a mobile money service has been a huge hit in Kenya. It is one of the widely adopted payment methods across the country. In addition to mobile money, Philippines is also registering a growth in Bitcoin usage. Bitcoin, a decentralized peer to peer digital currency has already established across the world as a reliable alternative financial services and payments platform.

The use of bitcoin for remittance is being explored by many Filipinos in the recent days. The Philippines has a huge inward remittances market, where the country’s emigrant populations send funds back to their families. Unlike conventional methods of funds transfer across borders, bitcoin transfers cost only a tiny fraction as transaction fees. In addition, remittance through bitcoin is faster than other modes out there.

The Bitcoin-based remittance industry in the country now has multiple players offering their services to the population. These Bitcoin-based remittance platforms have gained the name “Rebittace platform”, a combination of two words – Remittance and Bitcoin. Bitcoin can be used just like mobile money to pay for goods and services, provided the merchants accept it.

The increasing trend of mobile money and bitcoin usage among the Filipinos is driving the country towards a cashless economy.

Ref: Nikkei Image: NewsBTC