A new report by the Asian Development Bank (ADB) found that the Philippines‘ digital economy accounts for 2.5% of gross domestic product (GDP). It added that the country is lagging behind leading economies in Asia, such as Taiwan (6.1% of GDP), South Korea (5.8% of GDP), and Singapore (5.4% of GDP).
In a policy brief, the ADB said that advanced economies mostly derive greater value from transforming digitally.
“These variations highlight the central role of infrastructure, digital literacy, and regulatory systems in shaping both domestic and cross-border e-commerce outcomes across economies and regions,” the ADB said.
The Philippines was among the countries leading in fintech adoption, alongside its Southeast Asian neighbors Indonesia and Vietnam. The ADB stated “that adoption rates are especially high in emerging economies such as the Philippines and Vietnam, often surpassing those in mature markets.”
It highlighted that digital finance helps expand Filipinos’ access to various payment systems and enables cross-border transactions. However, ADB warned that rapid expansion also includes risks such as “cybersecurity threats, fraud, and over-indebtedness.”
Apart from fintech adoption, the bank highlighted that cross-border e-commerce could offer significant opportunities for emerging economies like the Philippines by expanding market access, reducing transaction costs, and enabling companies to participate in global value chains. The bank cited the growth in e-commerce adoption to 31.2% of firms in 2021, up from 14% in 2013.
“Strong and integrated regional fundamentals, including rising connectivity, mobile adoption, and digital ecosystems, further support this growth,” it said.
In its 2024 Digitalization Index, ADB classified the Philippines at the emerging stage of digitalization. The country scored 35.4 on the index, following Malaysia’s 47.5, Brunei’s 43.3, and Thailand’s 42.6. It was slightly ahead of Vietnam’s 34.6 and Indonesia’s 34.2.
However, progress doesn’t come without challenges. The bank said that regulatory fragmentation, inadequate infrastructure, and digital skills gap prevent economies and small businesses from fully benefiting from the digitalization shift.
“Unlocking the full potential of cross-border e-commerce will therefore require stronger digital infrastructure, more inclusive policies, and deeper regional cooperation to build coherent, trusted, and interoperable digital ecosystems,” the ADB concluded.
The bank called on governments to build legally binding frameworks for cross-border e-commerce, reduce digital trade barriers, strengthen digital skills and capacity, as well as bridge digital divides through investments in digital infrastructure.
Digital wallet adoption reached 54% in Philadelphia and Delaware: report
Meanwhile, a survey by WSFS Bank has revealed that 39% of consumers in the Greater Philadelphia and Delaware region in the U.S. are spending less than last year due to inflation and a desire for financial resilience. Residents in the region are prioritizing debit over credit and have adopted digital payment tools to manage their budgets.
According to WSFS Bank’s annual Money Trends survey, the key areas for reduction include restaurant and dining (down 38%), travel and vacations (down 35%), online shopping (down 33%), and entertainment expenses (down 32%).
Apart from that, the WSFS said that there is a move toward debit-based structures to avoid high-interest debt. It highlighted that most residents are increasingly using modern banking technology to manage their daily finances. According to the survey, the use of payment apps surged to 67% while digital wallet adoption increased by 54%.
“The findings reveal an interesting evolution in consumer behavior,” said Shari Kruzinski, Executive Vice President and Chief Consumer Banking Officer at WSFS Bank.
“Local residents aren’t just cutting back out of necessity; they are making a strategic shift toward more intentional spending. We are seeing consumers evaluate purchases, ask better questions, pause before making an impulse purchase, and choose debit options over credit. Consumers are finding innovative ways to make every single dollar work harder for them.”
Now, 73% of residents use mobile payment services like Venmo and Zelle, 64% of the region’s population use digital wallets, while cash and checks have fallen to 47% usage.
This shift represents a deliberate effort to move away from consumer credit products such as Buy Now, Pay Later (BNPL). By embracing real-time digital tracking, consumers are focusing on debt management and long-term financial health instead of short-term borrowing.
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