Fintech: Journey from Past, Skyrocketing to Future

Key Points:

  • The Bangko Sentral ng Pilipinas (BSP) reports that 70% of Filipino adults were banked into the formal financial system by the end of 2023, exceeding the initial target.
  • The number of digital retail payments surged from 30.3% in 2021 to 42.1% in 2022, primarily driven by significant progress in the fintech industry.
  • The annual Fintech Philippines Report 2023 demonstrated substantial growth in banking and connectivity, creating an optimistic scenario for the future of Filipino fintech.
  • The Philippines’ fintech market is projected to grow by $44 billion by 2024, assisted by increased government investments in digital infrastructure.

The year 2023 was groundbreaking for the fintech industry in the Philippines. The industry exceeded the banking target set by the Bangko Sentral ng Pilipinas (BSP), achieving a remarkable 70% penetration rate in the adult Filipino population and digitalizing 50% of all retail payments by year-end.

The Fintech Alliance.PH released the Annual Fintech Philippines Report 2023, which captured the evolution of the country’s fintech industry. The country has seen drastic growth in banking and connectivity, with deposit accounts growing by 9.2% to over 93.2 million in 2023 and 41 million e-money accounts actively used.

According to the study, the Philippines is anticipated to witness a 30% increase in the bankable population, expanding from 65 million in 2022 to 85 million by 2030. This substantial growth and the rising trend towards digital transactions underline how integral fintech has become in the lives of the Filipinos.

Fintech is expected to thrive even more with the Philippine government’s focus on bolstering investments in digital infrastructure to transform the country into a prominent digital hotspot. Various legislative bills aimed at improving digital accessibility, governance, and strengthening cybersecurity have gained momentum.

Looking forward, the future of fintech in the Philippines suggests the integration of lifestyle, automated and intuitive interfaces, better accountability and responsiveness, heightened trust and security, and proactiveness. It is anticipated that the fintech market will expand by $44 billion by 2024, driven by investment and digital transformation.

As we gear up for 2024, the focus continues to be on the financial empowerment of every Filipino and listening to the audience to enhance services. Though there is significant progress, much work still needs to be done to ensure a fully digital, inclusive, and empowered financial future for the Philippines.