PHILIPPINES — The combined value of transactions through InstaPay and PESONet reached P19.16 trillion in the first seven months of 2026, a 44.82 percent increase from the previous year. The surge was driven by lower or waived transfer fees mandated by the Bangko Sentral ng Pilipinas, marking a structural shift toward a cash-lite economy.
A Digital Payments Boom
Data from the BSP showed that the volume of transactions through both payment gateways more than doubled, rising 155.16 percent to 4.976 billion from 1.95 billion a year earlier. This explosive growth came as major banks and e-wallets reduced or eliminated interbank transfer fees starting in early July.
InstaPay led the charge, with transaction values jumping 60.32 percent to P9.509 trillion from P5.931 trillion. Its transaction volume surged an impressive 160.08 percent to 4.9 billion, reflecting its widespread use for everyday retail payments, e-commerce, and remittances. The platform's real-time, low-value transfer model has become the backbone of micro-commerce.
PESONet, catering to higher-value transactions, also showed strong performance. Its transaction value rose 32.23 percent to P9.653 trillion from P7.3 trillion. Volume grew 15.36 percent to 76.404 million, proving that even larger fund transfers are increasingly moving away from paper-based checks.
The Impact of Fee Waivers
The catalyst for this growth was BSP Circular No. 1238, issued on June 17, 2026. It required financial institutions to adopt reasonable, fair, and market-based pricing for fund transfers. The regulation argued that interbank fees should mainly reflect network costs, typically around P1.50, plus reasonable service costs.
Bank of the Philippine Islands was the first to permanently waive fees on July 1, with other banks and e-wallets quickly following. This move removed a significant barrier to digital adoption for millions of Filipinos. The result was an unprecedented surge in both new users and transaction volumes.
Financial Inclusion and MSME Growth
The fee waivers have accelerated financial inclusion, especially for lower-income Filipinos. Previously, transfer fees discouraged small transactions and kept some individuals away from formal banking. Now, micro-entrepreneurs, online sellers, and sari-sari store owners can transact digitally with minimal cost.
For micro, small, and medium enterprises, the savings are substantial. Faster cash flow and seamless payment processing boost their ability to grow and compete. The shift empowers small businesses to participate more fully in the digital economy.
Meeting the Digital Payments Target
The Philippines has already exceeded its target of digitizing 60-70 percent of retail payment volume by 2028. The BSP reported that digital payments accounted for 64.7 percent of retail transaction volume in 2025. This milestone demonstrates the country's rapid adoption of digital financial services.
However, the value share of digital payments remained lower at 53.3 percent. This indicates that high-value corporate transactions still rely on legacy channels like checks and wire transfers. The challenge ahead is to encourage digital adoption for larger payments as well.
