BSP: InstaPay still overtakes ATM withdrawals
Fund transfers done via InstaPay continued to surpass withdrawals via automated teller machines (ATMs) both in terms of value and volume postpandemic, indicating Filipinos’ growing preference to use digital payment services.
In a report, the Bangko Sentral ng Pilipinas (BSP) said the value of InstaPay transactions in September 2024 amounted to P623 billion, up by 45 percent year-on-year.
In terms of volume, online payments via InstaPay went up by 67 percent to 123.4 million.
That exceeded the P185.2-billion value of ATM withdrawals in September. But the total amount of cash taken out of these machines was larger by 10 percent year-on-year.
InstaPay also beat ATM withdrawals in terms of volume, although the latter nevertheless recorded a 10-percent increase in transaction count to 39.1 million.
But on a month-on-month basis, the volume and value of ATM withdrawals in September last year sagged by 3 percent and 5 percent, respectively.
Shift of preference
InstaPay is a real-time digital payment scheme that caters to small-value transactions not exceeding P50,000. This makes InstaPay very popular at the retail level, although using it carries fees that can go up to P75.
The BSP said InstaPay had taken over ATM withdrawals since 2020, when harsh pandemic lockdowns kept people in their homes.
But the fact that InstaPay is still more popular than ATM withdrawals despite the economic reopening just showed the “shift of preference of consumers toward safer and more convenient digital payment services,” the central bank said.
Data showed the share of digital payments to total retail payment transactions in the country had grown to 52.8 percent in 2023, from 42.1 percent in 2022. That exceeded the BSP’s target to digitalize 50 percent of retail payments in the country by 2023.
Moving forward, the central bank wants online payments to corner 60 percent to 70 percent of the country’s total retail transaction volume by 2028.
To hit the next target, the BSP has a number of policy proposals to convince more people to go cashless.
These include the removal of transaction fees for small electronic fund transfers and making payment operators shift to a subscription business model. These two measures are meant to bring down transaction costs.
