GCash is adopting the cashless payments model of Alipay, China’s leading third-party mobile and online payments platform, which is enjoying unprecedented success in China, India and the rest of Asia to give people ease, convenience, and security when purchasing goods and services from lowly street vendors to high-end shops.
Alipay is operated by Ant Financial which has earlier entered into a joint venture with leading Philippine telecommunications provider Globe Telecom and the country’s oldest conglomerate Ayala Corporation to boost the operations of Mynt, parent company of GCash mobile wallet service.
“I believe e-payments have a tremendous amount of potential in the Philippines given the continuous growth of smartphone penetration and the number of unbanked Filipinos. Only a very select group of Filipinos have access to financial services so we want to provide that access to them. Part of financial services is cashless payments. It has taken off in other countries like China and India where the people have realized its value because of the convenience and security that it provides — merchants and buyers don’t have to prepare change, e-money cannot be easily stolen, payments can easily be tracked, among other things,” said Ernest Cu, Globe President and CEO.
At present, 7 out of 10 Filipinos are unbanked while 9 out of 10 do not have access to formal credit. This situation has led to the popularity of cash payments in the country.
Eric Jing, Ant Financial Services Group CEO said: “Ant Financial is working closely with Mynt to bring digital financial inclusion to Filipinos. Imagine a day when you can just pick up your phone and pay using QR codes when you shop, buy tickets, buy food. We’re leveraging technology to provide that. We will use technology to make financial services more transparent and easier to access especially for those who are underserved or unserved. Digital payments with GCash is only the beginning of many new things. I am looking forward to GCash creating more benefits for the individuals and micro and small businesses in the Philippines and to provide financial inclusion for everyone.”
Aside from the scan to pay feature of the GCash App which was allows QR scanning to pay for goods and services, GCash customers can also use the app to cash in, top up their prepaid credit, borrow load, book movies, transfer money, and pay bills.
In China where Alipay started its operations, cash is becoming obsolete as people are doing away with paper money and coins to pay for about everything. Instead of cash, they use smartphones to scan QR codes – a type of barcode which includes the merchant’s information – and pay from their electronic wallet.
Electronic payment using QR codes has become a way of life in China that practically every business, big or small, even street performers are already part of the ecosystem. Right now, over half a billion Chinese are using Alipay’s e-payment system.
A similar trend is occurring in India with Paytm, India’s largest digital wallet where Ant Financial is also an investor. Paytm has already registered over 200 million customers for its digital wallet with a goal of reaching 500 million by 2020.