Philippines Targets Digital Growth with Better Connectivity, Fintech

Published Date : 8/6/2025 

The Philippines is making significant strides in digital transformation, focusing on improving internet connectivity, digital payments, and fintech to bridge the digital divide and enhance the economy. 

The Philippines is one of the fastest-growing economies in Asia, but it faces significant challenges in digital transformation. The country is actively working on closing the digital divide, enhancing internet connectivity, and providing the necessary skills and education to fully leverage the benefits of digitalization. The World Bank Group’s Philippines Country Partnership Framework for 2026-31 emphasizes improving internet connectivity as part of its efforts to create more private sector jobs.

The Digital Transformation DPL series, backed by the World Bank, supports reforms aimed at enhancing digital government services, the digital economy, digital finance, and digital skills. By 2026, the number of people using digitally enabled government services through the unified e-government portal or mobile applications is expected to increase by 30 million. Over the same period, the share of digital payments in retail transactions is projected to rise from 42 percent to 56 percent, and the number of e-commerce enterprises is expected to grow from 2.4 million to 3.5 million. By the 2024/25 academic year, fifty higher education institutions are anticipated to recognize digital skills courses via the Philippines Credit Transfer System.

The Philippines government, with support from the World Bank, is exploring follow-on reforms and investments to fast-track internet connectivity in rural areas and drive digital transformation across key sectors. This agenda includes integrating the national digital ID into public services, scaling up digital payment networks, establishing interoperable data systems, and expanding digital skills training.

In a country spotlight, the Tech For Good Institute, a non-profit founded by ride-hailing company Grab, identified fintech as a priority for the Philippines. Fintech is one of the fastest-growing sectors in the country, supported by initiatives such as the National Payments Act and the Digital Payments Transformation Roadmap. E-commerce and platform work are also highlighted as key areas for advancing the digital economy. GCash, a leading mobile wallet provider, has partnered with the Philippine Statistics Authority (PSA) to drive national ID and mobile wallet uptake. GCash has long used biometric technology from Ant Digital Technologies subsidiary Zoloz for performing KYC checks on new users.

The Tech For Good Institute emphasizes the importance of addressing the digital divide, noting that digital connectivity is crucial for linking local markets, connecting urban and rural areas, and facilitating employment, business, and social interactions. A 2024 study from the PSA and DICT found that Internet-connected households in the Philippines reached 48.8 percent, up from 17.7 percent in 2019. However, there are notable gaps, with regions like BARMM and Zamboanga Peninsula registering only 27.7 percent and 21.2 percent, respectively.

In his fourth State of the Nation Address, President Marcos highlighted digital transformation as a linchpin for the Philippines’ future, urging wider internet access, more efficient government services, and stronger science and technology programs. He framed artificial intelligence as a national imperative, noting new AI bills in Congress and a clear Department of Science and Technology mandate to deploy AI in health, agriculture, disaster risk management, and language tools.

Co-Vice Chair of the Management Association of the Philippines (MAP), Donald Patrick L. Lim, champions blockchain as a foundational trust layer. Lim points to early successes in gaming adoption and Asia’s first blockchain-specific law in the Freeport of Bataan, calling for its use in digital IDs, land titling, supply-chain transparency, and tracking public finance. He warned that cybersecurity is a matter of national security, advocating for a multisector council, Zero Trust architectures, and AI-powered threat detection.

Southeast Asia is a hotbed for digital identity and digital public infrastructure (DPI) initiatives, with countries like Malaysia, Indonesia, Vietnam, and Thailand making progress in their respective areas. The Tech For Good Institute advises regional commitments as another priority in advancing the digital economy. It cites the E-ASEAN Framework Agreement in 2000 and the ASEAN Single Window Agreement in 2005 as evidence of the region’s recognition of the importance of digitalization. The institute recommends such inter-member cooperation to foster trade, bolster data protection, promote digital payments, widen the digital talent base, encourage entrepreneurship, and harmonize digital activities across Southeast Asia. 

Frequently Asked Questions (FAQS): 

Q: What is the Digital Transformation DPL series in the Philippines?

A: The Digital Transformation DPL series is a set of reforms supported by the World Bank aimed at improving digital government services, the digital economy, digital finance, and digital skills in the Philippines.

Q: What is the National Payments Act and how does it support fintech in the Philippines?

A: The National Payments Act is a legislative framework that supports the growth of fintech in the Philippines by promoting a more secure and efficient digital payment ecosystem.

Q: How is the Philippines addressing the digital divide?

A: The Philippines is addressing the digital divide by expanding internet connectivity, especially in rural areas, and improving digital skills and education to ensure all citizens can benefit from digital transformation.

Q: What role does GCash play in the Philippines' digital economy?

A: GCash is a leading mobile wallet provider in the Philippines, playing a significant role in driving the adoption of digital payments and national ID systems through partnerships and the use of biometric technology for user verification.

Q: What initiatives are being taken to enhance cybersecurity in the Philippines?

A: The Philippines is enhancing cybersecurity through the advocacy of a multisector council, the implementation of Zero Trust architectures, and the use of AI-powered threat detection systems to protect digital infrastructure. 

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