THE PHILIPPINES could still hit its digital payments target by 2028 if it can advance developments in cross-border payments, lower transfer fees, and increase adoption for government transactions, a Bangko Sentral ng Pilipinas (BSP) official said.
“I remain optimistic because (it’s in) 2028, right? And we’re now (in) 2026. And the low end of the target is just a few points away,” BSP Deputy Governor Mamerto E. Tangonan told reporters on the sidelines of an event on Monday.
“The high end of the target, if all these fall into line — what I mentioned earlier — if the uptake is as good as we think it will (be), that direct debit will be huge, and if we’re able to make the fees more reasonable, and also get (the) government to adopt more, I think (that’s possible),” he added.
The BSP wants digital payments to make up 60%-70% of the total volume of retail payments by 2028 in line with the Philippine Development Plan.
In 2024, online payments accounted for a 57.4% share in terms of volume and 59% in value terms in the country’s total monthly retail transactions, according to the BSP’s 2024 Status of Digital Payments in the Philippines report. These are up from 52.8% and 55.3%, respectively, in 2023.
Mr. Tangonan said online payments growth has decelerated since 2024 amid slow adoption among the “late majority,” as well as concerns on security, affordability and internet connectivity.
“Right now, we have the early majority adapting and using it. What we need is the late majority to realize the second wave of growth,” he said. “That segment is… not as fast in adopting technology as the first, and they’re so value or price sensitive. That’s why I’ve been saying we have to make the fees more reasonable if you want that.”
“That’s why… there are many things I want to push. What I mentioned earlier: cross-border (payments), fees, and the government. We’re supporting the Digital Payments Act or now at the House, they call it the E-Bayad Act,” Mr. Tangonan said, adding that they hope the law is enacted within the year.
The official said they are working on setting up protocols to enable the return of funds to scam victims as part of efforts to promote digital payments.
“It can now be done bilaterally, but it’s better if there is a protocol common to all,” he said.
PROJECT NEXUS ON TRACKMeanwhile, Mr. Tangonan said Project Nexus, which will facilitate instant cross-border payments in the region, is on track to go live by midyear.
“Through Project Nexus, we are connecting InstaPay with the fast payment systems of five other major economies in our region. Indonesia recently joined as the sixth central bank partner,” he said in a speech during the same event.
“The goal is 24/7, near-instant transfers, mid-transparent, at low fees. We are working toward the implementation this year. Our planned launch date is mid-2027.”
In March 2023, the BSP announced that it will partner with the central banks of Malaysia, Thailand, Singapore, and India in connecting their domestic instant payment systems under the Bank of International Settlements’ Project Nexus. Earlier this year, Indonesia joined the project.
Mr. Tangonan said they are slightly ahead of the planned timeline.
“We’ve been saying mid-2027, because that’s the timeline agreed on by the central banks,” he said. “We’re a bit ahead (because) we’ve hired the key executives. We formed the company based in Singapore… They’re now running it. We selected a technology operator.”
This year, the six central banks are working on building and testing the project through their respective instant payment systems, he added. — Katherine K. Chan
