Global payments company Visa is optimistic about the adoption of Apple Pay in the Philippines following its launch this month, as more financial institutions and merchants move to integrate tap-to-pay services.

Apple Pay, which Apple introduced in 2014, lets iPhone and Apple Watch users make contactless payments by loading their debit and credit cards into the device's Wallet app. Its arrival adds a global, card-based tap-to-pay option to a market where domestic e-wallets and QR-code payments have so far driven much of the consumer shift away from cash.

"The traction is good and we're very happy with what we're seeing. So, we're betting on it. I think it's going to be successful once most of the banks are on the platform and once we run usage campaigns. So far, what we're seeing, it's good," Visa Philippines Country Manager Jeffrey V. Navarro told reporters on the sidelines of an event last week.

Apple Pay went live in the Philippines on Aug. 4. The banks supported at launch were China Banking Corp., GoTyme Bank Corp., Metropolitan Bank & Trust Co., and Union Bank of the Philippines. By comparison, seven issuers were on board when Google Pay launched in the country in November last year.

Mr. Navarro said Apple Pay integration carries its own set of requirements for participating entities, and that adoption of contactless payment technologies also depends on the readiness and appetite of the financial institutions themselves.

"It's really a matter of different entities and different platforms will have different requirements. That's all. I would say that they have their own set of standards, but each bank would have their own processes and their own pipeline priorities. So, it actually depends on their assessment on how soon they can get certified onboarding. So, it varies depending also on the appetite and the project pipeline of the issuer," he said.

The pace of Apple Pay adoption in the Philippines will depend on how many issuers can offer support, Mr. Navarro said.

"[In other markets,] I think after a year, we've seen a significant share of transactions. But again, like I said, it's always a function of how many are already implementing it, then running programs. So, we're waiting for that moment so that we can all work with all the participants to run programs to drive usage."

He added that consumer activity on Apple Pay differs from Google Pay, but said it may be too early to compare the pace of adoption between the two services.

"We're very happy with what we're seeing in social media in terms of how it's ramping up. What I can see is from how consumers are acting, the energy is a bit different. But in terms of, let's say, ramp-up, too early to tell… To me, the day of reckoning will be, let's say, after a year," he said.

"And remember, there are still big banks that have yet to activate. And once those are activated, we're waiting for how we can push usage programs. So, right now, there are still missing pieces to be able to say whether it's good or not. Once the ecosystem is complete, we do usage programs, then that's the best barometer for saying."

Contactless payments are expected to support the government's push for a cash-lite economy. The Bangko Sentral ng Pilipinas wants digital payments to account for 60%-70% of the total volume of retail payments by 2028, in line with the Philippine Development Plan.

— Aaron Michael C. Sy

Source: Bworldonline