InstaPay, PESONet transfers breach P19T

Transactions conducted through InstaPay and PESONet breached P19 trillion in the first seven months of the year following the rollout of lower or zero transfer fees by banks and e-wallets.

Latest data from the Bangko Sentral ng Pilipinas (BSP) showed that the combined value of transactions coursed through the two automated clearing houses climbed nearly 45 percent to P19.16 trillion as of end-July from P13.23 trillion in the same period last year.

The volume of transactions, meanwhile, surged 155 percent to 4.98 billion from 1.95 billion a year earlier.

This sharp increase in both value and volume came as major banks and e-wallets in early July either reduced or completely waived transfer fees for InstaPay and PESONet transactions.

First to permanently waive fees for interbank fund transfers was the Bank of the Philippine Islands (BPI), starting July 1. Other banks and e-wallet providers subsequently followed with similar fee reductions or waivers.

The fee cuts came after the implementation of BSP Circular No. 1238, which requires financial institutions to keep transfer charges “reasonable and fair market-based” and proportionate to the cost of providing the service.

Transactions through InstaPay, a real-time digital payment system for transactions of up to P50,000, surged 60 percent in value to P9.51 trillion in the first seven months. Its transaction volume more than doubled, jumping 160 percent to 4.9 billion from 1.88 billion a year earlier.

InstaPay is widely used for retail purchases, toll and ticket payments and e-commerce transactions, including by micro, small and medium enterprises.

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Meanwhile, funds transferred through PESONet increased 32 percent to P9.65 trillion from P7.3 trillion in the same period last year. The number of PESONet transactions rose 15 percent to 76.4 million from 66.2 million.

PESONet caters to larger-value fund transfers and serves as an electronic alternative to the paper-based check system.

As it is, digital payments had already accounted for 64.7 percent of total retail payments in the Philippines, according to the BSP, bringing the country within the government’s target of 60 percent to 70 percent.