NEARLY half of Filipinos now prefer to receive money transfers through digital platforms, according to a study conducted by Western Union Co.
The study also showed that almost 70 percent of Filipinos want to be able to choose how they collect their funds in the future—be it digitally or otherwise.
Citing data from the World Bank, Western Union said the Philippines is the fourth-largest inbound (receiver) market in the world, bringing in $37 billion in 2021.
“As consumers look to the future, the principle of choice in how to transfer money internationally is most appealing,” said Jean Claude Farah, the firm’s president for its Middle East and Asia Pacific operations. “This resonates with what we see among our customer base, who actively seek services that are convenient, fast and reliable, based on their needs.”
Western Union said the National Government and Bangko Sentral ng Pilipinas (BSP) have made “significant strides” in driving digital transformation and encouraging inclusion by creating and committing to a clear financial inclusion strategy.
However, Western Union’s study results show there’s still more to do. While many consumers opt to use digital platforms, many others don’t.
Trust ranks highly as a top barrier for using digital money transfer services among senders at 31 percent and receivers at 23 percent.
The data also showed 37 percent of receivers prefer face-to-face interaction, while senders say process or customer experience prevents them from doing so at 15 percent.
Amplification
HOWEVER, approximately 30 percent of senders and 14 percent of receivers do not transfer money online for reasons such as lack of connectivity, limited knowledge of digital services, no online banking history or because they are generally unbanked.
Farah said this “amplifies the need for larger ecosystems, where retail and digital platforms grow and evolve symbiotically.”
He said one of the firm’s key focus areas to accelerate growth in the Philippines and around the world is to build on its “core capabilities.”
“So that we can help grow, strengthen and evolve a financial ecosystem that surrounds our customers,” said Farah. “Through our omnichannel approach, we believe that we can harness the power of both the physical and digital touchpoints to serve all our customers’ money movement needs.”
Rising interest rates and increased cost-of-living expenses have driven headlines around the world. Against a backdrop described by the United Nations as the ‘largest cost-of-living crisis of the 21st century,’ consumers in the Philippines have been proactively trying to cope.
Keeping pace with daily financial needs, 44 percent of senders in the Philippines state that family support is the primary driving force behind how much and how frequently they need to transfer money.
In line with this, the data showed 83 percent of the country’s receivers agree they need to receive more money to support loved ones and family.
Dichotomy
MEANWHILE senders also struggle with a cost-of-living dichotomy. Some 77 percent said because cost-of-living has increased in the country they send to, they have to transfer more money.
However, 72 percent said that because cost of living expenses have increased in the country they live in, they are unable to transfer as much as they previously did.
With that, Western Union said both sending and receiving consumers agree that they expect transfers to increase in the next 12 months; with 74 percent of senders and 80 percent of receivers stating that their flow of money is set to go up.
“While many factors contribute to remittance flows, to remit is a personal decision—most commonly to support loved ones and family,” said Farah. “So, it follows that in the current economic climate, receivers have strong influence over the frequency and amounts their senders transfer.”
The study results explore consumer sentiment on money movement. More than 2,000 consumers across the Philippines who send and receive money internationally were surveyed.
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