Digido: PH fintech adoption may grow 72% this year

Digital wallets, also known as e-wallets, are playing a crucial role in driving the adoption of financial technology (fintech) services in the Philippines, as reported by consumer credit service provider Digido. The utilization of e-wallets in the country has surged by +1026%.

Digido’s report highlights that the adoption of fintech through mobile apps in the country is on the rise and could potentially surpass 72%, encompassing around 59.3 million users by the close of 2023.

“The findings from our report indicate that the momentum towards the ‘fintechization’ of the population is continuously strengthening,” said Farit Shakirov, country manager of Digido.

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In addition to e-wallets, other contributors to the surge in fintech adoption include digital lending (+330%) and e-commerce (+222%).

“The country’s fintech infrastructure is demonstrating remarkable adaptability to emerging challenges, largely attributed to a sizable domestic market and progressive government support,” Shakirov said.

The growth is anticipated to stem primarily from the payments and transfers segment (+17.6%), followed by e-wallets (+4.9%), digital banking (+4.3%), digital investments (+3.7%), and digital lending (+0.9%).

In the previous year, fintech service adoption among individuals aged 15 and above in the Philippines climbed from 64.4% in 2021 to 69.3%. Comparable to the broader region, the e-commerce sector was the predominant driver, with nearly 100% adoption among adults by the conclusion of 2022.

Growth rates

Digido’s data reveals thriving growth in digital banking, with a significant increase of 18.8%, totaling 163 out of the 867 actively used fintech applications in the country. E-wallets, which emerged as indispensable financial tools during the pandemic, continue their ascent with a growth rate of 15.5% or 134 applications. Payments and transfers follow closely with 104 (11.9%), wealth management with 86 (9.9%), and digital lending with 84 (9.6%).

The payments and transfers segment exhibited the highest monthly download growth rate of 11.3% from 2018 to 2022, trailed by Business Management (10.7%) and Financial Advisors (8.4%).

Contributors to five-year user growth

Over the past five years, the key drivers of the fintech industry’s advancement in the Philippines have been e-wallets (+1026%), digital lending (+330%), and e-commerce (+222%).

“The fintech industry has a substantial opportunity to sustain its momentum and work towards cultivating a more vibrant ecosystem by fostering greater trust through seamless, user-friendly experiences and productive collaborations,” Shakirov said.