January 12, 2025 | 12:00am
MANILA, Philippines — Filipinos can expect digital services to become cheaper in the long run as a result of more players joining the market to challenge current leaders GCash and Maya.
Fitch Group unit BMI Country Risk and Industry Research said finance apps such as GCash and Maya would be forced to innovate their pricing and services with the lifting of moratorium on new electronic money issuers (EMI).
GCash currently collects a two percent fee for over-the-counter cash-in transactions above P8,000 per month, which BMI thinks the e-wallet may have to rethink if new EMIs come into play.
Further, GCash slaps a convenience fee of at least P5 for cashing in through a bank account. The e-wallet also applies a one percent fee when topping up funds via PayPal and Payoneer.
Similarly, GCash imposes a service fee of P15 for bank and e-wallet transfers. Depending on the billing partner, the e-wallet also charges a similar fee for bills payment.
“The entry of new innovative players is expected to heighten price competition and push players to offer more advanced services, offsetting transaction fees that are likely to come under threat,” BMI said.
In spite of this, BMI said finance platforms associated with the country’s largest telcos are likely to maintain their market dominance even with the moratorium now lifted.
BMI said EMIs go through a licensing process with the Bangko Sentral ng Pilipinas (BSP) that requires them to provide data-driven analysis and market research.
They have to prove that their business model would work and the BSP will mandate compliance on transparent ownership. Above all, EMIs have to exhibit that their capital standing is adequate enough to withstand the financial requisites of the business.
As such, BMI said telcos have the room to grow their e-wallet subsidiaries, as they are ahead of their competitors in terms of capital availability and market familiarity. They may also introduce new services to keep their lead and widen their appeal.
Recently, the BSP has lifted its three-year moratorium on new EMIs to promote digital payments and widen financial access.
The BSP has issued licenses to 42 EMIs for non-bank financial institutions and 27 EMI banks as of 2024, and these EMIs are authorized to provide cash transfer and remittance services using an online system.
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