Real-time payment transactions in the Philippines are expected to double over the next five years as Filipinos embrace digitalization, according to a provider of electronic payment and banking services.
The 2024 Prime Time for Real Time Report, published by ACI Worldwide, forecasted that the volume of real-time payment transactions will reach 1.54 billion by 2028, a significant increase from the 777 million transactions recorded in 2023.
The report also projects that by 2028, real-time payments will constitute 58.7 percent of all digital payments in the country, with a transaction value expected to reach $209.6 billion, or P12.26 trillion.
ACI Worldwide attributed this rapid growth in digital payments, including the adoption of real-time payments, to the acceleration spurred by the pandemic, which has led to the transition to a cashless economy.
Moreover, the report highlighted a strong connection between the growth of real-time payments and the adoption of mobile wallets.
The Philippines ranks fifth globally in mobile wallet adoption, with 88 percent of Filipinos using a mobile wallet in the past year.
In 2018, the Philippines introduced InstaPay as the first real-time payment system in the country, as part of the Bangko Sentral ng Pilipinas (BSP) Digital Payments Transformation Roadmap that aims to digitize payments.
Furthermore, in November 2019, the BSP launched the national quick response standard, QR Ph, which increased awareness of InstaPay. This standard allows consumers to easily and quickly make person-to-person fund transfers by scanning a QR code.
ACI Worldwide's report indicated that Filipino consumers primarily utilize QR codes, mobile wallets, and bank accounts as the key methods of authorization for initiating real-time payments.
ACI Worldwide emphasized that as consumer demand for real-time payment methods grows, businesses are set to follow suit.
Additionally, the BSP plans to participate in the Regional Payment Connectivity program, which seeks to connect all member countries of the Association of Southeast Asian Nations using a unified QR code-based system. This initiative has the potential to facilitate real-time cross-border payments in the Philippines.
Leslie Choo, ACI Worldwide senior vice president and managing director, believes that real-time payments have the potential to boost economic growth and financial inclusion in the country by removing payment obstacles and increasing liquidity in the financial system.
For this reason, Choo encouraged local banks and financial institutions to harness technological innovations to fully leverage the capabilities of real-time transactions.
“Real-time payments are now a real-world reality and banks have the opportunity to innovate where real-time payment sits in the customer journey and the end-to-end payments landscape to provide a differentiated experience,” Choo said.