Low Usage of Mobile Money in the Philippines

SEDPI Staff showing cue cards to FGD participants
Contrary to popular belief, there is low usage of mobile money in the Philippines. This is one of the main findings of SEDPI’s qualitative research conducted on August 2010. Almost all of the respondents have little or no knowledge about mobile money.

The research aims to gain better understanding of the domestic demand for payment services in the Philippines. Payment services include sending money, receiving money, paying bills, loans and making purchases through payment service providers. Bank transfers, Western Union, LBC, M Lhuillier and Cebuana Lhuillier emerged as the most popular and most trusted payment service providers based on the research.

SEDPI conducted 22 Focus Group Discussions (FGDs) all over the Philippines with a total of 234 payment service provider users. The FGDs were organized in both rural and urban areas with respondents from the D and E markets.

The FGD results revealed that bank transfers are the preferred payment service provider. It has consistently ranked at the top of the list when clients use payment service providers to send or receive money, or to pay for bills, loans, and make purchases. Most payment service providers like Western Union, M Lhuillier, Cebuana Lhuillier and LBC are used mostly for sending and receiving money transfers. These payment service providers, in general, are hardly used in paying for bills, loans, or purchases. Only a few FGD participants had experience using mobile money. Most have little or no knowledge about this. As a consequence, they expressed mistrust on mobile money. SEDPI researchers asked the difficulties mobile money users face when using mobile money. They cited lack of Cash In-Cash Out centers (CICOs) and lack of merchants accepting mobile money.

The main purpose of sending money through payment service providers is for education and household expenses. The same is true when receiving money. Other reasons for sending and receiving money include loan payments, business expenses, bills payment, and medical expenses.

The Social Weather Stations is currently using SEDPI’s qualitative research results for its quantitative research nationwide. The Bill and Melinda Gates Foundation through Bankable Frontiers Associates commissioned the payments study. The full research results will soon be made available to the public.