33% of e-commerce transactions in the Philippines made via alternative payments

Nearly nine in 10 Filipinos shopped online in 2023.

Alternative payment methods are rapidly gaining ground in the Philippines' e-commerce sector, now making up over 33% of online transactions, according to GlobalData.

In 2023, 88.2% of Filipinos shopped online, with only 7% never having made an online purchase.

The e-commerce market grew by 27.8% to $20.6b (PHP1.1 t) and is projected to expand by 23.3% to $25.4b (PHP1.4t) in 2024.

“Philippines e-commerce market is experiencing strong growth, driven by factors such as rising internet penetration, improving logistics, a rise in the number of middle-income families, and increasing confidence in online payments,” said Kartik Challa, Senior Banking and Payments Analyst at GlobalData.

“With a preference for online shopping due to its ease and time-saving benefits, Filipinos are embracing digital platforms, making e-commerce an integral part of their shopping experience,” he added.

Younger generations, including Generation Z and millennials, are driving the rise in alternative payments, which now represent 36.4% of online purchases. Popular options include GCash, Maya, PayPal, and Dragonpay.

Despite this trend, cash remains a significant payment method, accounting for over 23.5% of e-commerce transactions, due to a high unbanked population and limited financial literacy, especially in rural areas.

The “buy now, pay later” model is also growing, with services from Atome, BillEase, Akulaku, and Tendo gaining traction.

The e-commerce market is anticpated to reach $46.5b (PHP2.6t) by 2028, with a compound annual growth rate of 16.3% from 2024 to 2028.

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GlobalData

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