Philippines is a country located in South-Eastern Asia, on an archipelago that once served as a protective harbour for first Spanish and later American interest in this part of the world. Ever since Europeans have arrived to this area, the country was exhibiting different governance momentum. While most of the Asian countries and empires back in the ages have already developed structures, pieces of culture and unified concept of nationalism, Philippines due to the location on hundreds of islands has been divided into thousands of small country-like tribes, intertwined with dozens of languages.
Geographical situation of the country for years hindered its infrastructural development, leaving it excluded from Asian-tigers group, as a country on relatively low-budget, low-earnings, low-development track. However due to the different dynamics of modern industries, Philippines might in fact end up as a new battleground for technological disruption, innovation and alongside with it – tremendous economic growth.
After the country has been occupied by the US forces back in mid-XX Century English language has been introduced and now it is widely taught and spoken across the archipelago – which makes it a perfect place to roll out new products for investors! Country’s population is steadily growing and currently standing at 105 million people, 71% of which being active internet users. Whilst previous industrial revolutions had smaller impact on the archipelago, now, the 4th industrial revolution consisting of 5G, IoT, AI and every small software technology around it will have a profound impact on the country’s future – because the infrastructure is easier to build than ever and the population is ready to embrace the new ways of doing things. Currently only 31% of people have a bank account and 4% of them make any kind of online purchases. This leaves the investors with a huge opportunity – fintech market is untapped. Widespread adoption still needs to happen and the market is prone to rapid change. State is also interested in reduction of cash-reliance to lower its costs and have a better overview of the state of the economy by digitalising the transfers of payments and salaries.
“[…] The fintech’s transaction value predicted to grow at an annual rate of 16.4% to reach $10.5 million dollars by 2022. The Philippine start-up economy is also still young and full of potential, giving it plenty of room to grow and bridge gaps in business services, in tech and financial inclusion. With a thriving business landscape and accessible tech solutions, other foreign companies looking to invest in the country will have better ease in setting up their business. The country’s vast talent pool also makes it perfect for building their own remote team that’s based locally.” On top of this, different form of government and lack of persuasive state interventions make is country easier to enter than also developing Vietnam, Thailand or Laos. Fintech companies, whether established or fresh start ups, are also vastly supported by national BSP bank and Department of Technology and Industry.
With all those positive impacts and opportunities the question still remains – will the industry be able to thrive on its own creating first national unicorns, or yet again country’s fate will lie down in western or Chinese conglomerates, tapping on an easy-to-enter market and capitalising on it? One is known for sure – today there is no better country to invest your money in Asia than Philippines.
// source:
https://kmc.solutions/blogs/the-emerging-fintech-sector-in-the-philippines/
