Bangko Sentral ng Pilipinas Governor Benjamin Diokno said Wednesday the Philippines is well on its way to becoming a “cash-lite” society following the launch of the QR PH that promotes further use of digital transactions.
The use of QR code payments were bolstered with the development of the National QR Code Standard, dubbed as “QR Ph” in accordance with BSP Circular No. 1055. QR Ph aims to transform the fragmented QR-driven payment services into interoperable payment solutions.
“Ten years ago, it may have seemed daunting to even set a target of transforming 50 percent of retail payments into digital form by 2023. This is due, in large part, to the study that showed that in 2013, out of the 2.5 billion payments made by Filipinos in a month, only 1 percent are done electronically,” Diokno said during the virtual event.
He said looking back, it first seemed impossible to achieve this target. But from 2018 to 2020, a steady rise in the share of digital payments in the country took place, with the volume growing significantly from 10 percent in 2018 to 20.1 percent in 2020, up by more than 10 percentage points compared to the more than 9 percentage point increase in the previous five-year period from 2013 to 2018.
The BSP launched the QR Ph for person-to-person payments or “QR Ph P2P” in November 2019 which primarily catered to remittances and payments within the informal sector. From only six pilot participants during the launch, it now has 23 participants as of end-August 2021.
“From the second quarter last year, transactions have likewise surged. The volume expanded by almost thirteen times its Q2 2020 level and the value surged by more than forty-five times its Q2 2020 level, exhibiting an average quarterly growth rate of 110 percent and 229 percent for volume and value, respectively, over the period,” Diokno said.
He said the use of QR codes for payments was gaining traction as an alternative to the traditional debit and credit card payments, given the ease, convenience and speed of merely scanning the code compared to having to bring a card, tapping, dipping or swiping it and signing a charge slip in many cases.
To complement the P2P component of the QR Ph, the QR Ph for person-to-merchant or “QR Ph P2M” was developed and its pilot run started in April this year.
QR Ph P2M enables merchants such as department stores, pharmacies, supermarkets, hardware stores and restaurants to accept e-payments with ease even in the safety of their customers’ homes. QR Ph P2M may also make bills payments faster and more convenient.
With the QR technology, one needs only a smartphone. Small entrepreneurs need not invest in costly electronic data capture equipment like point of sale terminals.
Merchants only need to print the QR Code that their payment service providers will generate for them, display those codes, and obtain payments by simply asking their customers to scan the codes.
QR Ph also minimizes encoding errors. By simply scanning the merchants’ QR code, both merchants and customers can be assured that the payment is sent to the correct account number of the merchant.
Compared to other modes of payment, QR code is quick and easy. Customers need not bring their physical wallets to pay or to manually input the merchant’s account information since such is already embedded
QR codes are one of the safest payment methods. Customers do not have to store sensitive payment information and data transferred via QR codes is encrypted, thus making payments secure.