Polytechnic University of the Philippines

Sto. Tomas Branch

Sto. Tomas, Batangas

The Effectiveness of E-wallet to the Filipino Users

A.Y 2019-2020

Submitted March 18, 2020

Submitted by: Bustamante, Jonalyn R.

Jumawan, Jevian T.
DOMT 2-1
 CHAPTER 1

Introduction

The digital revolution continues to transform most aspects of our daily life. In

particular, the digital revolution has resulted in the vertical convergence of business

channel capacities. The digital revolution also continues to transform the public sector

organizations and services. For instance, E-shopping and its payment should be paid online

or some can be paid on delivery time. Another example is, most of the University

admissions are done online. Most of the bus and plane tickets are be bought through online

transactions or via SMS, email and other social networks. A next step in the digital

revolution is the transformation of the time honored traditional physical wallet into the e-

wallet.

An electronic wallet can be described as a digital cashless provider that can update

difficult coins notes. For buying whatever, the individual does now not must rush in front

of ATMs or banks to withdraw coins, as an alternative transaction can be executed there

after which in a fraction of seconds. It has emerged as an upcoming way of purchasing

objects and services without any physical motion of coins. The e-wallet concept must be

able to keep money in a digital account, to give you the options to transfer money between

the e-wallet and your bank account or the credit card.

Bangladesh’s first complete mobile financial service provider, bKash Limited, a

BRAC Bank subsidiary, launched its mobile banking operation in July 2011. bKash is

designed to provide financial services via mobile phones to both the unbanked and the
banked people of Bangladesh. The overall bKash value proposition is simple: a safe,

convenient place to store money; a safe, easy way to make payments and money transfers.

Customers will be able to receive electronic money into their bKash accounts through

salary, loan, domestic remittance, and other disbursements and eventually will cash out the

electronic money from bKash authorized agents/ATM. (Mohammad Salah Uddin, 2014)

The Philippines have learned about the e-wallet system and has adopted the ways

how to use this virtual wallet in their payments and other business transactions. The number

of establishments that accept digital payments is ever-growing – from restaurants to gas

stations and retail stores. You can pay for the things that you need with a few taps on your

smartphones.

Gcash, the number 1 in the list of the top 8 most popular virtual wallet in the

Philippines has a lot of offers in business industry. Buyers can do both local and

international purchases online thanks to GCash’s affiliation with American Express Virtual

Pay. As the name suggests, GCredit works like a credit card with a ‘buy now, pay later’

function. People can conveniently pay for your purchases via QR code scanning in their

partner establishments. They can choose from different cash-in/cash-out methods. The

users can also send money to and receive from fellow GCash users. Users of this e-wallet

can do various transactions from paying bills, booking movies, and topping up or

borrowing load, among others. (GritPH 2020)

Shopback.Ph include in their article: Guide to Paying your bills, the “how to’s” of

paying electric bills via mobile app and e-wallets. People love e-wallet because of its
features. Invest Money is the feature they like the most because they can easily invest

money by utilizing the feature in one tap. (Ducut 2019)

People think using electronic wallet has been great. It has super streamlined a lot

of the financial things that they have to deal with every month, and the best thing about it

is that they don’t have to bring a wallet as much and go anywhere inconvenient anymore,

like bank or payment center. (Gcash 2020)

However, Electronic wallet or e-wallet has a security risk. Convenience is really a

big favor for the users but some think of how secure are their accounts. Cyber security

experts are of the opinion that with the use of online payment platforms, the fraudulent use

of payment networks and data theft has also gone up. There are several forms of cyber-

attacks where cyber criminals look for vulnerabilities within a technology and turn it to

their advantage and con people out of their money. The 2012 Google Wallet hack exposed

user’s PINs. (Blackchains.my 2017)

The article by Blackchains also conclude that If the user’s smartphone or tablet runs

out of power, they won’t be able to access the digital accounts on it. This can be a concern

if they’re a heavy user of your device, as power can quickly be sapped by battery-intensive

applications, leaving them stranded without power or money in your pocket (if your digital

wallet is your sole on-person money storage. The purchaser may have a lot of convenience

but they are facing security risk or inconvenience in a way. Thus, the e-wallet may have its

effectivity to the users.

Statement of the problem

The researchers want to find out the answers to the following questions and

gather data to support the research entitled “The Effectiveness of using E-wallet to

its Filipino users”. It also aims to find out if significant relationship exists between

the respondents.

1. What is the e-wallet user’s profile?

a. Age

b. Gender

2. How was the e-wallet patrons use the electronic wallet (purchase or

investment purposes)?

3. How secured is the Filipino user’s e-wallet account?

4. What is the implication of the study to the Filipino e-wallet users?

Significance of the Study

The results of this study may be used by individuals in choosing their way of

payments and purchase. Specifically, this will give individuals an idea on how to secure

their money every time they have transactions involving money. It will also help people

decide whether it is good to use e-wallet or have their money through bank or let it be in

the form of cash.

 Theoretical Framework

Technnuter is a news website in the internet that focuses on the news and e-

commerce. In their article entitled “What is e-wallet and Why is it important in the current

scenario” they point out the effectiveness of e-wallet in various idea. Following are the

article content that says the importance, benefit and features of E-wallet.

Importance of E-wallets

It is a proven fact that e-wallets are the best way to go cashless and make spending

money easier without having hard cash. Different countries across the world have

understood the importance of e-wallets and many of them have applied using them too.

The use of mobikwik coupon codes has increased in India with the increased of this e-

wallet.

They are accountable

With the help of e-wallets it becomes easy to trace transactions completely. Every

money spends or received will be mentioned in the e-wallet statement and you will be able

to check it anytime. Here cash transactions are easy as there are lesser security layers like

banks.

Instant transactions

Compared to e-banking facilities available in the market, e-wallets are smooth and

help in fast transactions. For banks they deal with larger transactions which consumes a lot

of time while eWallet carry out smaller transactions and with lesser security layers. This

makes transfer of money easy and that too within lesser time.
 Safer

This system is much safe compared to banks. This is because mostly people put in

a few amounts of money in the wallet which they need for coming few days. This means

there is a very low risk of loses in case your account gets hacked or you lose your account

for some unforeseen circumstances. This means you can use the e-wallet without having

to worry about losing larger amount of your life’s savings.

Better customer response

Most of the banks follow a standard working hour and it is not possible to get

response in case you don’t fall into it. For some serious issues you will need to take some

time out of your day and walk into bank to get your issue solved. With e-wallet you will

not be left behind. They offer a seamless communication channel which can help you stay

connected and get answers in case of any query.

Good discounts

Most of the e-wallets these days offer good discount on a number of products as

well as bill paying services. This means it becomes easy to save a few bucks when you

choose to use such e-wallets to pay bills or recharge your mobile service. It is even possible

to find such deals on LatestIndiandeals.in with ease. You can then use them on e-wallets

when shopping.

The market of e-wallet is going to stay in here for quite a long time. They have proved to

be easy and seamless for people and this makes it the best way to transact money.
Conceptual Framework

INPUT PROCESS OUTPUT

Socio-demographic
Profiling
1. Age
2. Gender 1. Profiling
Proposed Informative
2. Survey
e-Wallet Usage Questionnaire video to social media
Profiling informing electronic
3. Data-Analysis
1. Purpose of wallet user.
using e-wallet
2. Experience on
Security

Scope and Delimitations

This study is all about the Effectiveness of e-wallet to Filipino-user. The

respondents of this research were the random purchaser/payers from online category

and from physical stores. The researchers are going to conduct a survey for able to

clarify what are their perceptions regarding in our topic. The respondents must be

100 purchaser/buyers from NCR and REGION IV-A CALABARZON.

Definition of Terms

Electronic Wallet (e-Wallet)- E-wallet is a type of pre-paid account in which a user can

store his/her money for any future online transaction. An E-wallet is protected with a

password. With the help of an E-wallet, one can make payments for groceries, online

purchases, and flight tickets, among others.

GCash- is a local app that you can install on any of your devices—be it a smartphone or a

tablet. It allows you to pay your bills, purchase goods and services and even send or receive

money wherever you are.

 Chapter II

Related Literature

Foreign

Smart phones have become an inseparable part of people's life and is a convenient

tool for making digitalized payments. With expanding infiltration of portable cell phones,

digital wallets have been anticipated to bring the next rational stride in transit to a cashless

society (Apanasevic, 2013).

Like the rest of the world, India is also witnessing a rapid adoption of digital

payments. In fiscal year 2012-13 and 2014-15, mobile wallet (a form of digital wallet)

transactions grew by 180 per cent, compared to 80 per cent growth respectively, in mobile

banking transactions (Anand, 2015).

According to a July 2016 report by Google and the Boston Consulting Group

(BCG), 78% of all consumer payments in 2015 were made in cash down from 89% in 2010

and 92% in 2005. The digital payments industry in India is a huge opportunity that is

waiting to be tapped. The Google-Boston Consulting Group report predicts that the

industry can touch US $ 500 billion by 2020, contributing 15% to India's GDP (Gross

Domestic Product). Significantly, India is today in a sweet spot where customers want the

convenience of digital payments, policymakers are seeking greater financial inclusion and

higher transparency. With all the pieces in place, demonetization provides India a unique

opportunity to leapfrog into a brave new digital world. However, till date relatively a
smaller number of individuals have been utilizing mobile wallet, as compared to mobile

phone users.

The fundamental obstacle is the attitude of individuals to adjust to a yet another

innovation. In a nation such as India where larger part of consumers still favors Cash-on-

Delivery, it is difficult to fasten the pace of process of innovation diffusion such as mobile

wallets. So, in the present time, there is a need to re-examine the effectiveness of the factors

which drives customer intention to adopt/use mobile wallet. This will help Government,

banks and mobile wallet service providers to formulate effective policies in order to ensure

adoption/usage of mobile wallet by large number of people in India.

Jaradat, M. I. R. M. & Faqih, K. M. S., concluded that although perceived

usefulness was considered to be the most convincing predictor of digital payment solutions,

self-efficacy too plays a major role in adoption of digital payment solution as consumers

with higher degree of self-efficacy were more inclined towards the use of digital wallet, as

their comfort level with technology use was high.

Padashetty, D. S. & Kishore, K. S. critically examined the theoretical aspects of

electronic commerce to understand the substructure of behavior towards intention in using

digital wallet. The literature review specifies the consumer behavior towards the adoption

of digital wallets by taking into consideration various factors motivating adoption of

technology. Various factors have come into play which affect the adoption of digital
wallets as a payment medium such as trust, expressiveness and perceived ease of use,

playing a crucial role in facilitating adoption of digital payment solutions.

Liu, S. et al. concluded that security perception plays a significant role in adoption

of mobile wallets. Perceived security and privacy define the extent to which consumers

assume that digital wallet payment method is safe and secure. Perceived usefulness

motivates users via enhancement in their self-innovative capabilities. Factors like

authentication, confidentiality, integrity of data were identified to have a positive effect on

users’ trust in digital payment methods. They further concluded that digital wallet

payments bring extra convenience to shoppers by offering flexible payment additions and

accelerating exchanges.

Rai, N. et al. discovered that safety and security of payment as compared to

traditional methods, act as one of the driving forces for adoption of mobile wallet.

Mbogo, M. studied the various factors that contribute to success with the use of

mobile payments within micro businesses in Kenya. He inferred that convenience of the

money transfer technology plus its accessibility, cost, support and security factors are

related to behavioral intention to use the mobile payment services. He further concluded

that perceived convenience, perceived ease of accessibility, and perceived support had

positive relationship with the intention to use mobile payment services.

 Shin examined mobile wallet adoption by using the UTAUT model (Unified

Theory of Acceptance and Use of Technology) and proposed four additional constructs

i.e., security, trust, social influence, and self-efficacy. He confirmed that familiar factors

such as perceived usefulness and ease of use are key determinants toward consumer

acceptance. He further concluded that perceived security and trust are key determinants in

customer intention to accept mobile wallets, which in turn determines user behavior. The

research results also suggested that security and trust are enhanced by social influence.

Chen on 2008 examined the determinants that affect consumer intention to use

mobile payments (mpayments). He concluded that consumer acceptance was determined

by four factors: perceived use, perceived ease of use, perceived risk, and compatibility.

Pousttchi and Wiedermann on 2008 evaluated key factors that influences

customer’s intention to use mobile payments and found that subjective security was not a

primary driver of mobile payment acceptance. They found that perceived confidentiality

of payment details and perceived trustworthiness were strongly correlated. Four key

variables i.e., performance expectancy, effort expectancy, social influence, and facilitating

conditions were found which directly affect consumer intention and usage behavior.

Lin and Wang on 2006 examined the factors that contributed to customer loyalty in

mobile commerce. They concluded that perceived value and trust were found to be directly

related to customer satisfaction and customer loyalty. Customer satisfaction was also
suggested to positively affect customer loyalty. In addition to it, habit was proposed to

determine customer loyalty. They also found that customer loyalty was directly affected

by perceived value, trust, habit, and customer satisfaction.

Lee on 2005 investigated the impact of perceptions of interactivity on customer

trust and transactions in mobile commerce and concluded that trust plays an important role

in determining consumer transaction intentions.

Lu, Yao, and Yu on 2005 suggested that behavioral sciences and individual

psychology are strong determinants of adoption of mobile technology. They suggested that

while perceived usefulness and perceived ease of use are strong variables in consumer

willingness to adopt mobile technology, variables such as personal innovativeness and

social influence must also be taken into consideration in determining consumer acceptance.

Adoption of mobile wallet in India is still at infant stage. So, in order to make it a

success, Government of India and other stakeholders are making efforts to encourage its

customers to use mobile wallet. In the present study, efforts were made to check the

effectiveness of the factors that has been explored in the previous studies. Only one

significant factor i.e., perceived usefulness has been identified, that dynamically influence

the future intention of customers to adopt mobile wallet. Further, it has also been observed

that perceived usefulness positively influences the intention to adopt mobile wallet. As

usefulness of mobile wallet perceived by customers is positively related to mobile wallet

adoption, banks and other stakeholders should publicize the multifarious benefits of the

digital method of payment to a large extent, which would result into increase in

subscription of mobile wallet service.

Bangladesh’s first complete mobile financial service provider, bKash Limited, a

BRAC Bank subsidiary, launched its mobile banking operation in July 2011. bKash is

designed to provide financial services via mobile phones to both the unbanked and the

banked people of Bangladesh. The overall bKash value proposition is simple: a safe,

convenient place to Bangladesh’s first complete mobile financial service provider, bKash

Limited, a BRAC Bank subsidiary, launched its mobile banking operation in July 2011.

bKash is designed to provide financial services via mobile phones to both the unbanked

and the banked people of Bangladesh.

The overall bKash value proposition is simple: a safe, convenient place to

Bangladesh bank launched National Payment Switch in 2012, a common platform for the

country's commercial banks for electronic payments, which is going to revolutionize E-

commerce in Bangladesh. Once all banks in Bangladesh join the NPS (National Payment

Service), a customer using a credit or debit card of any bank will be able to draw cash from

any ATM and POS (point of sales) in the country, and transaction costs will significantly

go down as the transactions will be routed through the NPS instead of Visa, Master or

Amex card networks abroad. Moreover, purchase and sale can be done with cards through

the internet and web portals within the country. NPS will facilitate easy access to funds, an
increase in tax revenue, more flow of money in the economy, and financial inclusion. NPS

is a common electronic payment platform to help banks and their clients make transactions

in an easy and cost-effective way. Individual payment platforms introduced by different

banks will be abolished once all banks join the common platform.

Internet Banking or Online Banking Online banking (or Internet banking or E-

banking) allows customers of a financial institution to conduct financial transactions on a

secured website operated by the institution, which can be a retail bank, virtual bank, credit

union or building society.

To access a financial institution's online banking facility, a customer having

personal Internet access must register with the institution for the service, and set up some

password (under various names) for customer verification. The password for online

banking is normally not the same as for [telephone banking]. Financial institutions now

routinely allocate customers numbers (also under various names), whether or not customers

intend to access their online banking facility.

Customers numbers are normally not the same as account numbers, because

number of accounts can be linked to the one customer number. The customer will link to

the customer number any of those accounts which the customer controls, which may be

cheque, savings, loan, credit card and other accounts. Customer numbers will also not be

the same as any debit or credit card issued by the financial institution to the customer. To

access online banking, the customer would go to the financial institution's website, and

enter the online banking facility using the customer number and password. Some financial
institutions have set up additional security steps for access, but there is no consistency to

the approach adopted.

(Bourne et al. 1999). E-wallet promoters should implement a policy aimed at increasing

the usefulness perceived by the consumer and/or reducing the costs they incur. Several

studies show that consumers see e-wallets as a substitute for notes and coins.

In Europe, most e-wallets stand a high risk of being rejected. Indeed, the level of

usefulness perceived by the consumer is often very low because these e-wallets only allow

them to carry out payment operations and consumers do not want to bear the cost of use as

there exists a substitute which is almost perfect and free: cash. (Bourne et al. 1999)

The usefulness of an e-wallet depends therefore in its faculty to fulfill the traditional

functions of cash more efficiently and possibly to fulfill others. For example, it has been

clearly identified that there is an advantage for consumers to own an e-wallet in situations

where a micro payment has to be made and where it may be difficult to find the exact

amount of money needed for the payment. One of the conclusions drawn from the analysis

of the relative failure of Mondex’s introduction trial in New York.

Van Hove on 2001highlighted the necessity of offering e-wallets where they would

be most useful, for example for automatic payments (vending machines, launderettes).

The e-wallet can also be useful to the consumer if it makes the payment process in

itself simpler or faster. This is one of the justifications for adding on complementary

services to e-wallets. When taking public transport, the user will usually have to queue to
buy a ticket, pay, go through a ticket control system, and finally hold on to the ticket for

inspection. With the e-wallet, all these steps can be covered in one single action. The user

presents his e-wallet at the control point activating the payment and registering it (this

provides proof of being in possession of a valid ticket and the payment registering also

updates the e-wallet’s accounting system). The process is therefore both simplified and

speeded up by using an e-wallet.

The e-wallet will be considered useful when available in situations where the

consumer recognizes its advantage over cash; if it fulfils certain functions better than cash,

or if it is combined with complementary services which the consumer considers to be useful

in themselves.

User’s acceptance is a pivotal factor determining the success or failure of any

information system project. (Davis, 1993)

Many studies on information technology report that users’ attitudes and human

factors are important aspects affecting the success of any information system. (Davis, 1989,

Burkhardt, 1994, Rice&Adyn , 1991).

Users’ acceptance is “the demonstrable willingness within a user group to employ

information technology for the tasks it is designed to support”. (Dillion and Morris 1996)
 Electronic payment systems are not an exception of it. It means these are not

successful without acceptance of users. Electronic payment system is an innovative way

for online payments. Issues are not accepting easily because of lack of security in changing

business-environment. Online payment system requires improvement of information

technology. The failure of electronic payment system is depending on the factor that it

neglects the needs of users and the market.

Electronic payment refers to the mode of payment which does not include physical

cash or cheques. It includes debit card, credit card, smart card, e-wallet etc. E-commerce

has its main link in its development on –line in the use of payment methods, some of which

we have analyzed in this work. The risk to the online payments is theft of payments data,

personal data and fraudulent rejection on the part of customers. Therefore, and until the use

of electronic signatures is wide spread, we must use the technology available for the

moment to guarantee a reasonable minimum level of security on the network. With respect

to the payments methods they have been analyzed in this work, it is impossible to say that

any one of them is perfect, although each one of them has advantages as opposed to others.

If the client wants to maintain privacy, then they choose those payment methods which

guarantee a higher level of privacy such as E-cash or Net Bill Checks.

 If the priority is security, they should use, Smart Cards. Both consumers and service

providers can benefit from e-payment systems leading to increase national competitiveness

in the long run. The successful implementations of electronic payment systems depend on

how the security and privacy dimensions perceived by consumers as well as sellers are

popularly managed, in turn would improve the market confidence in the system.

Mobile payments—payment services conducted via a mobile device—have been a

key driver of socioeconomic development in emerging markets. Factors such as

advancements in technology, socioeconomic conditions, and the high penetration rate of

mobile devices are driving m-payment development in certain emerging markets. As Tom

Standage noted in his "Virgin Territory" Economist article (17 Nov. 2011), it's "easier to

use your mobile phone to pay for a taxi in Nairobi [Kenya's capital] than in New York."

A well-developed m-payment ecosystem has evolved in Kenya that, as of February

2012, had over 18 million m-payment users. 1 In the Asia Pacific, m-payment is expected

to grow by 15 percent annually, reaching US$3.8 billion by 2015. 2 Likewise, mobile

banking in Africa is expected to reach US$22 billion by 2015. 3 Table 1 presents some

examples of m-payment systems in the emerging economies of Africa, Asia, and Latin

America.

According to the International Telecommunication Union, mobile phone

penetration reached 79 percent in the developing world in 2011. 7 By 2015, in sub-Saharan

Africa, more people will have mobile phones than access to electricity. 8 Emerging markets

thus have a huge population of unbanked mobile subscribers. In developing economies,

most transactions are small. The average mobile transaction conducted via M?Pesa is about

a hundredth of the average check transaction and half of the average ATM transaction. For

small transactions, a typical m-payments transfer costs around 1 percent of the transferred

amount. M-payment is much more convenient for consumers in the developing world,

where financial and banking services aren't easily accessible. As of mid-2010, there were

over 17,600 retailers as M-Pesa agents in Kenya and only 840 bank branches. 13 Families

in Africa's rural areas must travel far from home to pick up remittances, adding significant

travel costs and time to the already high transfer fees.

The rapid growth of m-payment in emerging markets is driven by domestic rather

than international remittances. To understand the socioeconomic impact of m-payments,

it's important to note that domestic and international remittances correspond to different

population segments. Evidence from Thailand and the Philippines indicates that most

overseas workers are from urban areas with lower poverty rates.

Most international remittances are sent to urban areas of developing countries,

whereas most of the P2PT to rural areas are domestic transfers coming from the urban

areas. This means that domestic remittances, which is facilitated by m-payment, are more

relevant than international remittances to the bottom-of-the-pyramid households. 17 In this

regard, P2PT has been an important source of socioeconomic development and change

among the poorest of the poor.

 Payment models that rely on advanced technology aren't appropriate for the

developing world. In this regard, what differentiates M-Pesa from other providers is its

simple, low-tech mechanism for providing money transfers. To improve the m-payments

ecosystem, service providers, including banks and mobile operators, must increase

collaborations and partnerships with key value-chain partners, such as solution vendors,

app developers, retailers, merchants, handset and device vendors, and consumer

associations. Even more importantly, the diffusion of m-payment hinges on measures taken

to increase consumers' awareness and willingness to adopt such services.

The Demonetization process in India has great impact on cashless transaction. It

encourages usages of credit card, debit cards, online payment and mobile wallets for

financial transaction among public. The demonetization has influenced the digital payment

platforms in India. The Digital transaction e-wallets have significant impact on increasing

usage of cashless transaction. The Usage of the mobile wallet and its application is trend

among young population ranging the age group of 18-25 years.

The mobile wallet provides services through companies and individuals can pay

and receive payments via mobile applications. India has the largest market in the global

arena in terms of Smartphone and mobile phone apps for payment transactions. Payment

gateways and banks are approaching toward cashless transaction. Meanwhile, mobile apps

play a big part of the Government’s initiative of “Cashless India”. This will have an

enormous impact on making India a digitalized cashless economy. This study focuses on

the impact of mobile wallets on cashless transaction. The RBI Reported that mobile
payment startup cashless transactions 13.5% growth in September 2017, Digital transaction

has grown from Rs.109.82 trillion in August to Rs.124.69 trillion in September, and the

maximum was in March at Rs.149.59 trillion.

Digital transactions in December 2017 crossed the 1 BillionMark, touching a new

peak in terms of volume since the government’s demonetization exercise in November

2016. Transactions through the Unified Payment Interface (UPI) also reached a new high,

clocking 145.5 million transactions in December 2017. The study has been conducted by

Google and the Boston consulting group in September 2016, they said that past four years

has seen an exponential growth. The report expected the digital wallet industries to grow

by 10 times and revenue expected is around $500 Billion by the year 2020.It contributes

around 15% to Gross Domestic Product (GDP).

The number of Non-Banking institutions offering digital payment are also going up

significantly. It is also expected that cashless transaction would exceed cash transactions

by 2023. By 2020, 40% of the consumer payment segment would be based on cashless

modes of payment like cheques and demand drafts, credit and debit cards and mobile

wallets. The research has been concluded that last 5 years, due to the rise in the growth of

startups has encouraged digitization of transactions in the country. Mobile wallets support

increases financial presence in all forms across the sectors in the economy. Online

electronic commerce also supports drastically fast growth business is conducted in day to

day life. RBI data has shown that mobile wallets have at present exceeded mobile banking
in measurement terms. The measurement of mobile wallet money transactions folded

during April 2015 to Feb 2016 time to cross Rs.55 crores. This data shows that a mobile

wallet consumer has grown 5times to 150 million in 2 years. Mobile wallets are easy to

access, are safety, and frequently a life saver.

Have conducted a research to understand the factors that affect consumer’s

adoption of mobile wallet. Survey was conducted among 210 mobile phone consumers to

understanding the mobile wallet adoption.

The results show that the Perceived Risk, Performance Expectancy, Facilitating

Conditions, Perceived Value, Social Influence, Perceived Regulatory Supports well as

Promotional benefits are important aspects in predicting Behavioral Intention to accept

mobile wallet adoption. It is also found the effort expectancy was insignificant. A study

has been conducted among different companies to understand different aspects that

influence the user’s decision to accept mobile wallets. Survey was conducted among 150

mobile phone consumers to understand the reason for mobile wallet adoption. It has

analyzed the data by using ANOVA to interpret the results. They concluded that

convenience of shopping and brand loyalty play important factors in acceptance of mobile

wallets. They added safety of funds and security play a challenging aspect for continue

usage of mobile wallets.

 They have conducted a study on “Cash-less Society: Drives and Challenges in

Nigeria” to analyze if it is possible for developing a cash-less society through more actual

use. This research investigated the cash-less economic structure has to evaluate its

possibility in Nigeria through concerns to save time, awareness and adequacy the

environment of level and improvement both educationally and technologically.

Investigated the factors involved in adoption of a new innovation by consumers in the

mobile payment.

The research was conducted to find out the various factors affecting consumer

intention to use mobile payment. The research findings stated that performance expectancy,

effort expectancy, social influence, facilitating conditions have significant effort on mobile

payment service adoption. questionnaire and the result shows that the cashless policy

caused important to users’ satisfaction in Ogun State through adoption of electronic

channels and emphasize that cashless policy is user friendly and progressive. Has focused

the study towards usage of mobile wallets in the urban population inhabitants of Jalgaon

city.

This study has analyzed that impact of demographic characteristic and their usage

of mobile wallets. The survey was conducted among the 60 respondents in the urban area

of Jalgaon city. The results show that 29% of the respondent use mobile wallets to transfer

money for recharging phone and DTH payment. 50% of the consumers are apprehensive
about the safety of Mobile Payment and 42% of the respondents prefer to use others

cashless transaction as the payment choice. Nearly of 81.7per cent respondents stated that

safety is major important brought the goods through online. It is said that cash back on

digital payment is an effective method of motivating the population to adopt cashless

transaction. After the demonstration was successful, an effort to encourage cashless

transactions began in semirural and rural India. The government has decided to provide

20% cash back to the consumers who are using cashless transactions through following

modes of digital payment namely Rupay debit card, BHIM app, Aadhaar, UPI or USSD

transaction). The government expects the cash back will not only support promote the

digital India action but also encourage in building the economics as a total country. She

stated that GST council has declared to relook the procedures, Laws and rates to support

the MSMEs (micro, smaller, medium enterprises). It also helps the smaller business to

increase employment rates in the country.

Indian population has the largest mobile users but there is a huge gap to be filled,

overall 40% of the people are not using the bank account still now. Nearly 80% of payments

are complete through cash only. Therefore, Indian government and GST Council can be

provided offers which can motivate this population to adopt of cashless transaction. It is

expected that small impact on revenue becomes an effective way for the Government to

improve the database containing the digital payment footprint of their taxpayers. Indian’s

have conducted a research to find out Security, trust, privacy issues and challenges of

cashless transaction in India. This study has been conducted among 210 online consumers’
using the facility of cashless transaction through mobile wallet. The findings of the study

showed that majority of the consumers have downloaded and are using the “paytm” mobile

wallet application. The research reveals that less than ¾ of the respondents were using

cashless transaction system for shopping stationery, fruits & vegetables and less than ¾

majority of the consumers had faced problem in usage of e-payment application due to

security issues and software applications.

The research reveals that mobile wallet consumers are mostly avoiding the cash

and cards payment transaction after demonetization. 55% of the consumers have adopted

mobile wallet apps. India is trailed by China and Denmark. Indian consumer’s mobile

wallet adoption attitude is most advanced when compared to UK and the US. Last five

years (2013 -2017) mobile wallet transaction developed has multiplied (eg.2013-INR 24

Billion, 2017-INR 955Billion).

On 2018 Mobile wallet market was around INR 1 Trillion [16]. The survey has

considered cash crunch in most of the ATMs in India after Demonetization November

2016. Thereafter, the government is recommending people to move to electronic mode

payments for people. The whole worth of mobile wallet payment transaction developed in

two to three times between 2016-2017. At first considered as post demonetization,

electronic commerce payment device, these mobile wallets applications are now frequently

utilized for day to day payment transactions at medical shops, grocery stores, street tea

stalls, supermarkets, fuel station, taxis, auto-rickshaws and street vendors.

 Demonetization has triggered more usage of e-payment among public which

increases the usage of cashless transaction. Transferring money through cashless modes

would basically demand the usage of plastic money i.e. credit/debit cards, mobile wallets,

net banking and more. This indicates a movement towards a cashless economy. The

government initiative on Digital India to boost the adoption of digital payment system

among the individuals.

Throughout history, there have been numerous different types of payment systems

(Lai, 2016). Today electronic payment systems have become the in-thing for the E-

commerce world. There are a number of electronic payment systems but this chapter will

focus on the retail payment systems involving Card, Internet and Mobile that lead to the

convergence of the technology for the E-commerce world. There are numerous advantages

using electronic payment as compared to cash. A cashless E-payment system, for example

an E-payment card (e.g.: credit card, debit card, pre-paid card or E-money card), may well

be smaller and lighter, provide convenience and efficiency that support the E-commerce

world. The convergence of different technologies of E-payment interactions for the E-

commerce world has emerged in the consumer centric world. Businesses can be conducted

accurately, quickly and flexibly with the electronic payment solutions for the E-commerce

world. Management can tap the opportunities of the electronic payment technologies for

E-commerce by providing electronic payment solutions that meet the consumers’ intention

to use (Lai, 2016).

 Southeast Asia represents one of the fastest growing economic regions in the world.

(Asian Development Outlook, 2011). A major reason for this economic juggernaut has

been the growth of emerging Southeast Asian countries, which have developed rapidly

over the past decades. (Asian Development Outlook, 2014).

An outcome of this impressive growth has been increased investment opportunities

for private equity investors to include venture capital and business angel investors. (Scheela

et al., 2015; Scheela, 2014). According to the Global Entrepreneurship Monitor (GEM)

global report entrepreneurship is a major factor in this impressive growth cycle in Southeast

Asia. GEM researchers Amoros and Bosma (2014) report that entrepreneurs in the

emerging countries of Malaysia, Indonesia, the Philippines, Thailand and Vietnam have

shown above average intentions to become entrepreneurs because of both increasing

economic opportunities and the high status of successful entrepreneurs in this region.

Recent private equity research has focused on the impact that business angels have on the

development of high-tech industries, to include E-commerce technology, in these five

emerging Southeast Asian countries. (Amoros and Bosma, 2014)

Every time technology changes, it creates threats to established ways of doing

business and opportunities for new ways to offer services. Technology advances including

broadband internet and mobile have reached critical mass with news sources saying these

are going to be the ‘next big thing’. The world of electronic payment is changing with the

introduction of mobile phone Near Field Communication (NFC) as well as Radio-

frequency identification (RFID) contactless payments, in-app payments or payment apps

and with these changes the way we shop and make payments. (Lai, 2006).

Marketers and managers need to be watching developments proactively to

determine their potential impact. Leading firms often seek to shape the evolution of

technological applications to their own advantage (Lovelock, 2001, Lai)

Local

The introduction to this report outlined the connections between remittances and the

processes of development. They saw that remittances contribute to individual and national

development through increasing the available income for consumption, investment in human

capital and investment in productive assets. It also introduced several problems with current

remittance systems, including high direct and indirect costs as well as the persistence of large‐scale

informal markets.

Mobile remittances in the Philippines have been documented as having the potential to

address these problems. By tackling these specific issues, mobile remittances are leveraging the

benefit that Filipino society gains from its economic migrants and the resulting remittances. In

doing so, it is argued that mobile remittances positively contribute to the process of development.

Mobile remittance services in the Philippines are a private sector, profit‐oriented proposition. Globe

and Smart both situate their service within a broader mobile money offering that is both popular

and profitable. The profitability of these services is viewed as both a key factor in their introduction 54F

as well as underpinning their financial sustainability. The significant size of the Filipino remittance
market has meant an attractive business proposition for both Smart and Globe. In addition, the

possibility of attracting the approximately 50% of remittances sent through informal channels, has
6

increased the attractiveness even further.

It is commonly known that a country’s infrastructure system determines to a large

extent the efficiency of the economy. In a modern economy, the payment system is a major

component of the country’s infrastructure system. Indeed, no country nowadays can afford

to take its payment system for granted. Firms pay wages to their employees and purchase

raw materials from their suppliers. In turn, they receive payments for the sale of their

products and services. Consumers make payment transactions several times in a day.

Needless to say, value is transferred among participants in the economy every minute of

the day, and it increases as the economy grows.

The country’s payment system, therefore, must be efficient so that funds can

quickly move among market participants for productive use, thereby promoting more

activities in the economy. According to Humphrey et al. (2000), the resource cost of a

nation’s payment system can account for 3 percent of its GDP. Modernizing a country’s

payment system can certainly reduce that resource cost. Thus, while the country continues

to spend on roads, bridges, power supply, etc., it must not neglect to invest in its payment

system to improve the efficiency of economy, in general, and the financial system, in

particular.

Through the years, payment systems have considerably changed as forms of

payment have evolved from precious metals to currency and checks and recently to
electronic payments. These changes have been made because of the need to facilitate

voluminous transactions occurring in rapidly growing and increasingly more sophisticated

economies. Customers naturally seek the most efficient payment method, while providers

of payment services normally seek the most profitable payments system.

Advances information technology and changes in laws, institutions and regulations

in some countries have encouraged the emergence of new payment instruments as well as

the delivery and processing arrangements for small and large value, time-critical payments.

With ecommerce now in the mainstream of economic activities, we can therefore expect

more major changes in the payment systems worldwide in the next five years than we have

in the last five decades. Obviously, the Philippines cannot escape from this sea change.

Forecasting the future is always tricky. However, in this article, we'll introduce

opportunities & trends for mobile wallet startups who aim to make an impact on the

financial services industry. (Gandikota, Digital Revolution Article, 2017)

A payment is the trade of value from one party to another for goods, or services, or

to fulfill a legal obligation. In the last 20 years, plastic money and physical cash, bank

transfer or wire transfer have been the popular options that people used for all kinds of

needs from buying candy to transferring money.

Plastic money comes at the expense of users having to remember too many

passwords, PINS, TANs etc. which have become the stumbling blocks in letting the user
have a smooth digital payment experience. This also prevents the users who are used to

physical transactions in cash to switch to digital platforms. Many businesses these days

come up with their own loyalty programs enabling their users to make a transaction in

points and in some cases with their own currencies. However, it is lofty to carry all the

cards, plastic money, or apps for every time a user makes a transaction. This is where

mobile wallets come in.

Great euphoria was generated since the launch of Apple, Samsung, and Android

Pay. Three factors play a major role in the success of these players. They are (1) access,

(2) interoperability and (3) sustainability of the operators. Obviously, the player who has

access to the consumer’s bank account and their tie-ups with the number financial

institutions will be the winner in the race. Google has tied up with 41, while Apple has tied

up with 1199 banks in the US alone, 88 retailers and is available in 6 countries, while

Samsung Pay has tied up with 133 banks, is accepted at 101 retailers, and Android Pay has

partnered with over 41 banks and is accepted at 64 retailers. These numbers keep increasing

as each of the players is trying their best to capture the market. If we go by numbers,

obviously, Apple Pay is the winner for time being.

Mobile wallets are versatile and secure which serves multiple purposes. They can

act as a consolidated platform for different types of financial services at your fingertips

without having the need to go to a physical bank. Thanks to pervasive computing, mobile

wallets are master pointers for different types of payments.

 To say it in a computer science jargon, mobile wallets are used for opening and

closing a transaction and choosing which sub-pointer to assign – in other words, the

payment type is a pointer to the source of money that is the mobile wallet in this case. In

this sense, a payment type can become a wallet, and a wallet can become a payment type.

The wallet sometimes can be used as an app at a retail outlet and vice versa pointing to a

card and in turn points to a bank account.

Payments are always subject to banking regulations. Banks have an aversion toward

too many transactions enabled via wallets for the fear of limiting their reach in comparison

to mobile wallet startups. Traditional banks would be happier if their customers stick to

plastic money. From a customer’s perspective why carry a card when direct transfer can be

done from a mobile? Customers definitely don’t want to carry a lofty wallet with plastic

money (credit cards, debit cards, loyalty cards) to make a payment. How about using a

mobile phone for making payments wherever they go? This is where mobile wallets make

their great entrance. Unlike leather wallets, which are atom agnostic, payment type agnostic

and lofty to carry, mobile wallets promise the user the flexibility and the power as a

consolidated platform for making payments.

There are many opportunities in developing countries where regimes of these

respective countries are bringing reforms aiming at financial inclusion at a rapid pace. As

part of it, they have daunting tasks ahead of them: easing the banking regulations to include

unbanked in conjunction with the transformation on the technology front keeping up with
the rest of the world. Here lies the opportunity for mobile wallets to collaborate and

complement by solving major problems on the banking front and also on the technology

front.

A good example of the former case is RecargaPay. Founded in 2010, RecargaPay

is a mobile payment platform and wallet for the Brazilian market. The app allows anyone

to access the benefits and convenience of a mobile payment system without needing a bank

account thus empowering unbanked people. The startup covers financial services such as

sending money and requesting money in addition to facilitating conversion loyalty points

to currency and vice-versa.

In most of the existing contactless payments such as Apple Pay, Android Pay, and

Samsung Pay rely on Near-Field Communication (NFC in addition to QR codes) which

means the smartphone being used should have NFC enabled. This presents a new question,

whether there are any other alternatives for contactless payments other than NFC. Google

officially unveiled its first foray into mobile payments in Asia. The search giant has

launched Tez in India, a free mobile wallet that lets users link their phones to their bank

accounts to pay for goods securely in physical stores and online, and for person-to-person

money transfers with a new twist: Audio QR (AQR) which uses ultrasonic sounds to let

you exchange money, bypassing any need for NFC. AQR — the sound-based format for

transferring money securely between devices — is its own proprietary technology. This
appears to be the first time that Google has used it for payments, although it has used

ultrasonic sound for transferring information between devices before.

In fact, three-quarters of the 69 million internet users in the Philippines shop online.

However, the growth of eCommerce in the country is not as great as one would imagine

and it may be because Pinoys still believe that “Cash is king.”

Despite the availability of different payment methods, Filipino online shoppers still

prefer COD. According to the World Bank, fewer than one in 50 Filipinos are credit card

owners. That may be one of the reasons, along with the fact that only four in 10 internet

users use a mobile wallet service. While that is not a bad number, there are still so many

who have yet to enjoy the perks of e-wallets.

Whether or not they are already using an e-wallet it’s a good idea that they learn as

much as you can about it. After all, it’s not impossible that a few years from now, it’s all

we use for all our transactions.E-Wallets vs. Online Banking. Some people use the terms

e-wallet and mobile banking interchangeably but e-wallets should not be confused with

online banking apps.

There are actually a few differences between the two but here’s the core difference.

An app for online banking is a mobile point of entry to the user’s bank account that allows

you to view your balance and do some transactions like wire transfers.
Depending on your bank, your phone may be allowed to function as an NFC device for

payments. On the other hand, a digital wallet acts as a substitute for an actual wallet that

you can fund with money from your bank. You can transfer money from your bank to your

e-wallet and use the latter for online and in-store payments.

There are a lot of benefits that come with the use of mobile wallets. Here are some

of them. They don’t have to bring cash all the time. The number of establishments that

accept digital payments is ever-growing – from restaurants to gas stations and retail stores.

They can pay for the things that they need with a few taps on they smartphones. They can

keep track of their purchases easily. There’s no need to have a dedicated purse for all their

receipts because they can access them all through the records on your e-wallet.

E-wallet subscriptions often come with frequent discounts and cashback offers,

especially when you use it to pay for your bills. While credit and debit cards are still the

main vehicles for cashless transactions, mobile phones can now be used to make payments,

thanks to innovations in smartphones and financial technology (fintech), and the

establishment of non-financial companies or digital payment service providers that allow

the unbanked consumer to be part of a cashless society.

 Behind the rise of digital payments in the Philippines are some big players, such as

PayMaya and Globe Telecom, and new digital payment service providers that have started

to gain traction such as Coins.ph and GrabPay.

Michael Yeo, senior research manager at IDC Asia/Pacific Financial Insights, notes

that with new players coming up as well as having great conditions for growth, the

Philippines should see further sustained growth in mobile wallet transactions. IDC

estimates that there will be US$702.7-million worth of businesses transacted through

digital wallets in the Philippines this year, which will grow to US$1,748.4-billion by 2021.

A study conducted by digital payments service provider, PayPal, indicates that the

Philippines is well on its way to be a cashless nation, with 25% of consumers surveyed

saying traditional (physical credit card, bank transfer, internet banking, checks, etc.) and

new payment methods are now their primary options. In fact, one-third of consumer

respondents in the Philippines have already started transacting without cash, the study

claimed.

Meanwhile, Visa’s 2017 Consumer Payment Attitudes Survey reveals that six in 10

(57%) Filipinos prefer using electronic payments as opposed to cash, up from 46% in 2015.

Results from security firm Kaspersky Lab’s Cybersecurity Index done during the

second half of 2016 revealed that more Filipinos now use the internet for online shopping
(90%), for accessing online payment systems and digital wallets (89%), and for online

banking (74%).

Kaspersky Lab observed that Filipino consumers, majority of whom are unbanked

or without deposit accounts, use mobile wallets as alternatives to bank accounts, noting the

increasing preference of consumers to pay online not only because of the convenience it

brings but it also serves as a more secure way to pay. Moreover, digital payments offer

lower processing and transaction fees, provide tools to better manage finances, and allow

tracking of payments.

“With most Filipinos unbanked yet are starting to make online payments through

the use of mobile phones, digital payments have risen as an easy alternative to conduct

financial transactions,” said Siang Tiong Yeo, Southeast Asia’s general manager at

Kaspersky Lab, citing online shopping and online banking as among the contributing

factors that led to the adoption of digital payments in the Philippines. While digital payment

holds a lot of promise, the service would only achieve mass adoption if more Filipinos have

deposit accounts or mobile wallets, and own smartphones that enable it.

Results of the 2017 Financial Inclusion Survey (FIS) conducted by the Bangko

Sentral ng Pilipinas (BSP) reveal that only 15.8 million of Filipino adults have a deposit

account, and only 1.3% of them have an electronic money (e-money) account. Ownership
of an account that can be used to save money, receive salary, send or receive remittance,

and pay bills is a basic indicator of financial inclusion.

Banks continue to have a higher share (11.5%) in account penetration than non-

banks such as microfinance non-government organizations (8.1%), cooperatives (2.9%),

and non-stock savings and loan associations (0.3%), reveals the BSP report. While formal

account penetration remains low and growth is modest, there are opportunities for greater

financial inclusion enabled by digital technology, according to the BSP report. At present,

accounts are still underutilized for payment and remittance transactions. Among account

owners, only 18% are receiving salary, 12% are sending/receiving money, and 6% are

receiving pension through their account. Nearly 9 out of 10 adults have payment

transactions of which 60% are paying in cash.

Over-the-counter remittance transactions are very prevalent among senders and

receivers of money as 93% used remittance agents in sending money while 83% used them

for receiving money in the past six months. Digitizing these payment and remittance

transactions is a crucial step towards digital financial inclusion, said the BSP.

Given a robust economic growth and a young consumer population, the Philippines

will see an acceleration in cashless transactions despite apprehensions about digital

payment systems as the trust towards cash is still there. To achieve this, however, the

country must overcome the challenges that have to be encountered in migrating to, or

implementing digital payment systems. The biggest hurdle in cashless payments are the
lack of reliable and secure payment infrastructure combined with the still pervasive

consumer mindset that cash remains fast and uncomplicated.

Jubert Alberto, country head of operations at IDC Philippines, claims infrastructure

plays an important role in the wide acceptance of digital payment in the Philippines and

issues like connectivity are one of the major inhibitors.

Siang Tiong Yeo stresses that while major cities in the Philippines enjoy relatively

fast connectivity, most Filipinos are still struggling to log on and stay online. To overcome

this, Yeo observes that the government is on its way in improving the country’s internet

capability with the National Broadband Plan currently in the works.

Paolo Azzola, chief operating officer and managing director at PayMaya

Philippines, cites mindset as another major challenge because the Philippines is a cash-

driven economy, and Filipinos prefer to transact primarily in cash.

There is a certain comfort level when paying via cash, but more and more Filipinos

are seeing the benefits of going ‘cashless. Filipinos finding out that it’s easy and convenient

because they can get an e-wallet account like PayMaya in as fast as one minute. As the

demand for digital payment rises, so is the importance of technologies and other factors

that help drive the growth of cashless transactions. The continued and sustained uptake of
smartphones as well as cost-effective point-of-sale (POS) systems at the merchant side will

be critical in achieving industry growth. (Azzola 2018)

The simpler the POS system at the merchant side, the more likely that the merchant

will be interested in using such payment schemes. This is why QR codes have been so

popular in other markets as they allow merchants to accept payments from even the most

basic of smartphones and with minimal amount of effort on their side. (Alberto 2017)

The government, likewise, has taken initiatives to encourage cashless transactions

and protect the interest of people who are using the digital payment technology. The

Bangko Sentral ng Pilipinas (BSP) has been one of the more progressive central banks in

Asia in terms of welcoming the rise of electronic payments and other financial technologies

for use by the general public.

The BSP has launched two key initiatives – the National Retail Payments System

(NRPS) and the National Strategy for Financial Inclusion (NSFI), both of which are

designed to help bring the share of digital transactions from the current 1% to 20% by 2020

through a safe, efficient, and reliable payment system.

Through InstaPay, individuals, businesses, and government institutions will be able

to send and receive funds or make payments in real-time of up to Php50,000 per

transaction, without limit in a day. The transferred funds are instantly received in full as no
fee is charged for the electronic crediting of funds to the receiving party’s account in

InstaPay participating institutions. Charges may however apply to sending parties.

Recipients may also be charged for cash withdrawals.

Prior to InstaPay, the Philippine EFT System and Operations Network or PESONet

was launched in November last year by BSP as part of its initiatives to modernize the

country’s retail payment system and increase the adoption of greater use of electronic

payments. A batch electronic fund transfer (EFT) credit payment stream, the PESONet is

the first automated clearing house (ACH) under the NRPS which provides an electronic

alternative to the still widely used paper-based check system.

According to Michael Yeo, governments can play a critical role if they understand

the potential digital payments can have in reducing inefficiencies in current payment

systems. He cited governments in Singapore and Thailand have identified digital payment

as a key tool in increasing fiscal health, even to the point of using digital wallets to help

increase tax revenue.

A well-thought-out national-level payment plan which encourages the private

sector to form parts of the overall payments solution can be highly beneficial in spurring

overall development of payments in a nation. He added that moving towards a more holistic

approach to smart city initiatives will also help in this pursuit as allied technologies and

services to improve the level of digital payment adoption will be pushed. Security is also
becoming a major concern for users of digital payment platforms. It is one of the important

factors that consumers need to check when choosing digital payment services, apart from

convenience, cost, and efficiency. (Yeo 2018)

Nearly half (46%) of account holders who have access to the internet are ambivalent

about e-payments due to issues such as hacking, personal security breaches, and unsafe

access, reveals the BSP report. Kaspersky Lab’s Yeo noted that while the very technology

of contactless payments requires several layers of protection, it still does not mean your

money is 100% safe. Many elements of bank cards are based on obsolete technologies like

magnetic strip, possibility to pay online without additional authentication, etc.

As more channels and new financial service offerings emerge, threats will diversify.

Among security issues they foresee in digital payments include real-time payment

challenges, social engineering attacks, mobile threats, data breaches, cryptocurrency

targets, account takeover, pressure to innovate, fraud-as-a-service, and ATM attacks.

The security of digital payments does not rest on the platform alone, but on how

users safeguard their personal login information such as passwords, according to Azzola.

PayMaya works very hard to keep its security systems updated, and continuously look for

ways to make transacting on its platforms safe for their users.

 Addressing emerging security risks and consumer trust in the digital payment

system, Azzola claimed PayMaya, being a mobile-first payments product, is closely linked

to a person’s mobile account, and they have made steps toward keeping everyone’s

PayMaya account updated as soon as possible.

Meanwhile, the growing adoption of digital payment technology also affects the

security of overseas Filipino workers (OFWs) in countries where digital payment is more

advanced. This is driving the need to raise awareness about the risks of a cashless society.

Neumeier said the Philippines has an estimated 2.2-million overseas workers who

work somewhere, and usually in countries where the adoption of electronic payments is

more advanced. In 2017, these OFWs sent back to the Philippines remittances totaling

$28.1-billion which form part of the country’s gross national product.

As these cash transactions play a crucial role not only for the Filipino families but

to the country’s economy, it is high time to promote cybersecurity awareness among

Filipinos working abroad as well as their families.

PayMaya account holders can use their PayMaya cards in all establishments that

accept Mastercard or VISA, which could number to hundreds of thousands if not millions

of stores here and abroad. In addition, they can also use it for online shopping like Lazada,
Zalora, booking flights in Philippine Airlines or Cebu Pacific, or subscribing to or buying

virtual goods from their favorite digital services such as Spotify, Netflix, or Steam.

For PayMaya QR, PayMaya has partnered with the biggest brands that include The

SM Store, the brands under Robinson Retail Holdings, LCC in Bicol, Mercury Drug and

Rose Pharmacy, quick-service restaurants like McDonald’s and BonChon, grocery stores

such as Super8, and entertainment venues like cinemas at Megaworld Lifestyle Malls –

among many others – so that account holders have more avenues to pay using their

PayMaya app.

Digital wallet and mobile payments app, Coins.ph, likewise is driving the

promotion of cashless payment in the Philippines. Coins.ph enables everyone, including

those without bank accounts to store value in their Coins.ph e-wallet, transfer money for

family and friends, pay bills, buy load, reload beep cards, and make payments across the

Philippines directly from their phone.

Six out of 10 Filipinos prefer cashless payment. Today, 49% have more cards in

their wallets compared to five years ago, while 29% carry less cash. The increase of

cashless payments can also be contributed to the advent of online shopping, with online

retailers such as Lazada and Zalora going strong in the market.

According to the survey, 71% of Filipinos now shop online at least once a month,

and the e-commerce industry is expected to grow 30% year-on-year. Aside from shopping,
other online transactions made by Filipinos involve bill payments, a more convenient way

of managing their bills.

More than half (62%) of the respondents also found carrying cash unsafe, while

57% preferred faster transactions, which is possible with electronic payments. The findings

from the survey indicate that banks in the Philippines are in a perfect position to leverage

on the country’s strong electronic payment opportunities.

cashless?

Filipinos have a larger appetite for new technology that bring convenience and

security compared to the rest of the neighboring nations who are already ahead in the game.

This is another conclusion that VISA gleaned from their study, and it indicates strong

electronic payment opportunities in the future.

Enabling access to electronic transaction accounts will enable the majority of

Filipinos to use e-payments, which is a more secure and cost-effective means to access a

full range of payment and financial services such as contactless card payments, online

payments and conventional credit or debit card payments over the counter. Leveraging on

a broader range of financial services can help Filipinos to build assets, better withstand

financial shocks, and participate more broadly in the country’s economy.

 The ease of conducting financial transactions is probably the biggest motivator to

go cashless. It eliminates the need to carry wads of cash, plastic cards, or even queue up

for ATM withdrawals. With the manic traffic in the city, any change that can help you

avoid travelling to the bank is much looked forward to. It’s also a safer and easier spending

option for people who are travelling.

Having the capability to track their spending will make it easier to have a better

grip at their cash flow. Written records will let consumers keep tabs on their transactions,

which is the first step to successful budgeting. This also provides consumers the

opportunity to build their credit history or record, but whether it will be good or bad, will

depend on the consumer’s financial habits.

With clear credit history, banks will be more inclusive in their products marketing

or approval. It will be easier to apply and qualify for banking products and services such

as credit cards and loan – provided that you have a clean credit record. However, this can

work both ways, as your product application can also be easily rejected due to poor

financial health.

With the obvious demand for more outlets and resources for electronic payment,

there’s no other way to get around but for our country’s payment system to adapt it. The

question now is not whether the country is ready for a centralized cashless payment, but

rather how well will the Filipinos adapt to it once it gets implemented in the not so distant

future.
 The 29-notch jump in the country’s ranking in World Bank’s Doing Business 2020

report, which ranked the country 95th among 190 economies covered in terms of ease of

doing business. (Canivel , Digital Payment System to make doing business in PH Easier,

2020)

PayMaya founder and CEO Orlando B. Vea said digital payments form a critical

component in making it simpler for interested parties and individuals to set up a business

in the country. Payments complete the cycle for setting up or doing business in the country,

especially when applying for permits or remitting taxes, which is why having digital

payments acceptance in the online portals of government agencies plays an important role

in simplifying and improving government processes for doing business in the country,”

Vea said.
 CHAPTER III

Methodology

Methodology is the analysis of the principles, methods, rules, and postulates

employed by a discipline (Howell K.E, 2013). This section contains procedures,

definitions, and explanations of technique used in gathering and analyzing data in relation

with the possible status of the dependent variable in the business. The methods that the

proponents will use are research design, respondents of the study and data gathering

procedure.

Research Design

The proponents would use the descriptive method in research design because it uses

to describe the characteristics of population or phenomenon being studied and the answers

will be used as information. The proponents gain opinions and information through the

survey to be conducted that can help proponents in having predictions on future trends

using the prevailing situation as a basis.

Data Gathering Instrument

The proponents will use data gathering instruments in the form of questionnaires to

get the necessary information needed in the study. The proponents will use one set of

survey questionnaire.

The respondents survey questionnaire contains the profile of the respondents

including name which is optional, age, and gender. It also includes questions that will

describe their experiences in using electronic wallet.

Data Gathering Procedure

In order to get the accurate information series of steps was as follow: First, the

proponents will provide a letter signed by the Research adviser together with the signature

of Department Chairperson of the ITECH.

The proponents will start to make a survey questionnaire that is subject for

validation of the Research Professor. After approval of the survey instruments, A total

number of 200 questionnaires will be distributed by the proponents to the target area which

is NCR and REGION IV-A CALABARZON.

After the retrieval of the questionnaires from the respondents, the information

gathered will be tallied for the accuracy of the research conclusion. The technique was

chosen due to its effectiveness in construction and tabulation.