The analysts at UnaFinancial have studied the e-commerce trend and growth potential of Buy Now, Pay Later.
The e-commerce market is forecasted to rise 2.5 times reaching USD 12 Bn by 2025 in the Philippines. The share of Buy Now, Pay Later payment methods will grow from 3% in 2020 to 7% in 2025, equalling nearly USD 843 M.
In 2025 e-commerce of Philippine is expected to increase 2.5 times amounting to USD 12 Bn in the 5-year period. The growth of e-commerce will have a positive effect on all digital payment methods, BNPL included. The BNPL services will develop organically, mirroring the growth of e-commerce. Thus, the segment will rise by 40% a year, growing USD 140 M annually. By 2025, the BNPL payment method in the Philippines will reach USD 843 M, demonstrating 3.5x growth.
In 2020, 3% of all Filipino e-commerce, USD 150 M worth of transactions, was attributed to BNPL. The Buy Now, Pay Later payments will account for about 7% of all e-commerce payment methods by 2025. The ongoing consumer demand and rising number of providers are both fueling the growth of the BNPL segment. The results of the Group’s survey confirm the demand for such payment methods. 42% of respondents said they often cannot pay with their own savings for purchases up to PHP 50,000. 17% cannot afford such purchases at all without attracting additional funds.
The growth of the BNPL market speaks of its convenience for the un- and underbanked population. In the Philippines, BNPL platforms are accelerating rapidly, mirroring the trend throughout the Southeast Asia region. Meanwhile, the other existing companies are also implementing Buy Now, Pay Later to diversify their services. The growth of e-commerce, high usability and full digitalization of the process will ensure rapid growth of the “Buy Now, Pay Later” segment, accompanied by a significant increase in its market share compared to other methods of payment.