Bernardo M. Villegas
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Cashless Transaction for the Poor

          The poor are always the last to benefit from any improvement in technology, especially digital technology.  A possible exception is the digital financial service made available to the tens of millions of unbanked poor households, especially in the rural areas where 75 percent of those who fall below the poverty line reside.  In a recent trip to Davao, I talked to a friend who is in charge of marketing the services of digital financial services leader PayMaya. Those who benefit from these services are mostly among the unbanked 75 percent of the population.  In many areas of Mindanao, the poverty incidence can be as high as 60 percent, in contrast with the national average of 21 percent and 4 percent in the National Capital Region.  My friend Joey Manulid told me that in the hinterlands of Agusan del Norte, some forestry workers are already receiving their wages via PayMaya Negosyo-Smart Padala from the enterprise owner who is based in Butuan City.  In Panabo, Davao del Norte, banana plantation workers pay their utility bills and buy airtime load though a PayMaya Negosyo agent in their neighborhood.  This is quite an improvement from their past practice of taking a 50-kilometer roundtrip ride on habal habal and tricycles to the poblacion.  In Cagayan de Oro, BPO workers send money to their parents in Bukidnon via PayMaya Negosyo agents.

         These examples of cashless transaction in Mindanao illustrate how PayMaya and other financial services initiatives are paving the way for wider cashless adoption with support from the national QR code standard that has been launched by the Bangko Sentral ng Pilipinas (BSP).  Through QR Ph, PayMaya users can now receive money transfers from other institutions such as the UnionBank, LANDBANK, Chinabank, AUB, and RCBC.  To receive money from other banks and financial institutions, a PayMaya account holder just needs to go to the Settings section of the app and click on the QR code icon to reveal their unique QR Ph code, which is also EMV-compliant.  The sender can then scan this code with the bank’s mobile app to initiate the fund transfer.

         PayMaya and similar approaches to cashless transactions are being actively promoted by the BSP that in addition to its primary objective of keeping inflation down is very concerned about using monetary tools to address the unequal distribution of income in the country.  As Governor Benjamin Diokno commented: “Standardizing QR payments in the country means everybody can benefit from this cashless payment technology, such as small vendors and tricycle drivers.  This is yet another step in helping boost digital transactions and financial inclusion efforts across the country.”  With QR Ph launched and for full implementation by June 2010, more Filipinos among the lower income groups as well as micro and small enterprises are expected to join the formal financial system as they are now able to easily do interoperable electronic fund transfers and digital payments for their day-to-day transactions using their mobile phones which are now widely spread across income classes. 

         The PayMaya solution to helping the unbanked and financially excluded members of Philippine society is a good example of the collaboration between the private business sector and government agencies both at the national and local levels.  PayMaya is working closely with the Bureau of Internal Revenue, the Social Security System, the Department of Trade and Industry, the Department of Foreign Affairs, the Department of Science and Technology, the Philippine Statistics Authority, the Tourism Infrastructure and Enterprise Zone Authority, the Professional Regulation Commission, and the National Home Mortgage and Finance Corporation.  In addition, there is also partnership with the local government units such as those of Valenzuela City, Manila City and Quezon City, among others, to integrate card and emerging digital payments acceptance within their respective online and branch office services. 

         We have to salute the owners and managers of Voyagers Innovations which launched PayMaya, the only financial technology company in the Philippines offering integrated consumer and merchant payment solutions with the widest on-ground branch network.  It is the first to give Filipinos from all walks of life an e-wallet that allows them to pay cashless transactions at any time of the day, anywhere in the world, and from any device.  Voyager Innovations is the leading technology company in the Philippines backed by PLDT, KKR, Tencent, World Bank’s IFC and the IFC Emerging Asia Fund.  Thanks to the example that PayMaya has set, it is inevitable there will be many other enterprises that will also try to meet the challenge of addressing the needs of the unbanked through fintech.  What excites me is that many of these new solutions will come from those who are now millennials and centennials who are most at home with the disruptive technologies of the digital age.  For comments, my email address is