DAVAO CITY—A new global study conducted among leading corporate executives, including those from the Philippines, has indicated that the shift by businesses to the digital platform could be permanent, driven mainly by the experience of smoother transactions and the prospect of reaching the financially underserved sectors.
In a statement furnished to the BusinessMirror, American consumer credit reporting agency TransUnion LLC, said that “with the Philippines remaining under varying degrees of quarantine due to Covid-19, businesses’ shift to digital could be permanent.”
“Covid-19 has dramatically accelerated digital transformation with 78 percent of Philippine executives surveyed as part of our study saying their organization has changed their digital transaction process due to the pandemic,” according to Maria Gracia Pia L. Arellano, president and CEO of TransUnion’s local office TransUnion Information Solutions Inc.
The report said nearly 84 percent of Philippine and 85 percent of global executives surveyed said “they believe smooth transactions are essential to business survival rather than merely a competitive edge during and after the pandemic.”
The report commissioned by TransUnion to the Economist Intelligence Unit “highlights which emerging technologies could present challenges for and increase fraud prevention, economic inclusion and consumer privacy.”
The TransUnion said “all of this digital progress will be wiped out if we can’t remove these barriers to building bilateral digital trust.”
For instance, Arellano said, 70 percent of Philippine executives in the study who said their company changed their digital transaction process as a result of the pandemic experienced glitches.
The research “uncovered how technologies like artificial intelligence, national digital IDs and super-apps can help overcome hurdles and possibly create new challenges to building digital trust.”
The report titled “New Dimensions of Change: Building Trust in a Digital Consumer Landscape,” included responses from 1,610 executives in Brazil, Canada, Chile, China, Colombia, the Dominican Republic, Hong Kong, India, the Philippines, South Africa, the UK and the US, including 115 Philippine executives.
Combatting digital fraud
Overwhelmingly, the TransUnion said, respondents answered that: biometrics would be the dominant payment customer authentication method; improved fraud detection and security is the greatest benefit to using AI; and, a national digital ID system would help prevent consumer fraud.
Approximately 92 percent of Philippine and 85 percent of global executives say biometrics “are likely to be used to authenticate the vast majority of payments in the next 10 years.”
It said 46 percent of Philippine and 43 percent of global respondents noted that improved fraud detection and security is the greatest benefit to using artificial intelligence (AI).
“This was the top selection by far with smoother customer experience being the second most used answer globally at 29 percent worldwide and 23 percent in the Philippines,” the TransUnion said.
It added that the vast majority of executives, 84 percent in the Philippines and 79 percent globally, “think national digital IDs will help fraud prevention in consumer transactions.”
Seven in 10 executives globally and 77 percent in the Philippines “believe a national digital ID gives low-income groups access to consumer services they would have previously been excluded from.”
“By industry worldwide, respondents from consumer lending and telecommunications think such IDs give lower-income groups access to services they might otherwise lack,” the report said. “Both industries have led the way over the last decade in reaching the community of financially underserved customers, manifested in innovations like microfinance and mobile money.”
The Philippine Statistics Authority has announced it would begin registering Filipinos for the Philippine national digital ID by the fourth quarter this year.
“Ensuring consumer trust starts with preventing fraud. Our research overwhelmingly showed that biometrics, AI and national digital IDs aren’t just a fad for consumer fraud prevention. They are key for trusted commerce for the foreseeable future,” Arellano said.
The TransUnion said 82 percent of Philippine and 73 percent of global executives “believe consumers are comfortable sharing personal data with private companies.”
Nearly 71 percent of worldwide and 79 percent of Philippine executives said so, according to the report.
The study said Brazilian, Chinese and Dominican Republican executives “have vastly differing views about whether or not consumers are willing to share data with private companies versus government bodies (more than 10 percent difference in each country between sharing with governments and companies).”
It said Chinese respondents believe consumers are much more comfortable sharing personal data with government bodies than companies, while Brazilian and Dominican Republican executives have the opposite belief.
“Technological innovations like AI, biometrics and national digital IDs paired with proven fraud prevention methods like device intelligence can provide a more convenient and inclusive way for consumers to transact that still protects security and privacy,” Arellano said.