Recent statistics have estimated the internet population in the Philippines to be the fastest growing in the world. It is determined to have enjoyed a growth rate of 530% over the last 5 years. The E-Commerce industry is also set to grow at an annual growth rate of 101.4% between 2016 and 2020. The Philippines is home to a sizeable youth population and is well placed to see continued online retail activity in the coming years.
This is not only a local trend, the Asia-Pacific region has been booming in E-Commerce sales over the last number of years and has surpassed North America and Western Europe in terms of Business to Consumer (B2C) sales. The graph below displays the exponential growth that the Asia-Pacific region has been enjoying versus the corresponding growth figures for other parts of the world.
B2CE-commerce Sales Worldwide by Region, (values in billion US$)
E-Commerce activity is dependent on access to the Internet and as the world's online footprint increases, consumers will inevitably increase the amount of products they buy online. Statistica.com has forecasted that the total number of smartphone users in the Philippines will reach 38.4million by 2020, as displayed by the figure below.
.png)
Number of Smartphone Users in the Philippines, (In Millions) Source: E-Commerce Across Asia – Trends &Developments – Asia Briefing, pg. 4
The Department of Trade and Industry (DTI) in the Philippines has reaffirmed their commitment to facilitating this growth in the E-Commerce market. “The coming years will be bullish for Philippine E-Commerce and come 2020, our strategies and plans for the industry will exhibit a 20/20 vision— utterly perfect and accurate,” Undersecretary Prudencio Reyes Jr. declared in the recently concluded E-Commerce Forum.
Meanwhile, as E-Commerce grows stronger, so has theFinancial technology (Fintech) industry. Fintech veers away from traditional financing by using technology or the internet as its platform for serving customers. Through technology, Fintech has an upper hand compared to traditional financing in terms of convenience and speed.
Fintech has paved a progressive and reliable road for Micro, Small, and Medium Enterprises (MSMEs) in the Philippines through the convenient service it offers. Fintech is also rapidly and constantly innovating to meet customers’ demands. While the industry offers a wide number of products, the groundbreaking aspect of Fintech that has benefitted MSMEs significantly is business financing or online loans.
Business financing or online loans complements the E-Commerce industry by providing financing at the speed it needs. It’s arguably the best solution for online merchants who would encounter negative cash flow spikes once in a while; during holidays or certain seasons of the year. Learn more about how MSMEs can benefit from business financing or online loans here:
As both E-Commerce and Fintech rise to serve more businesses and consumers alike, the Philippines and the international market in general will be poised to evolve for this aggressively growing online commerce.It’s also safe to say that local merchants are set to enjoy a prolonged period of prosperity and success with business financing advancing to meet its need seven before the market realizes what it needs.
Need business financing today? Apply for one with First Circle by clicking here.
Sources: Philippines E-Commerce Roadmap 2016 to 2020: Department of Trade & Industry Philippines
Statista.com
