In his recent State of the Nation Address (SONA), President Ferdinand Marcos Jr. emphasized the importance of digitalization as a catalyst for economic growth and closing the digital divide in the Philippines. With the digital economy contributing 9.4% of the GDP, amounting to a 3 trillion pesos in 2022, and 42% of retail payments already done digitally last year, the government is steadfast in achieving the Bangko Sentral ng Pilipinas’ (BSP) 50% digital payment target this year. As part of this vision, the government has introduced the e-commerce roadmap, launched the eGov app, and is actively advocating for National IDs, anticipating their future benefits.
Despite these significant strides, the journey to digitalize Small and Medium Enterprises (SMEs) in the Philippines remains challenging. Recognizing the obstacles faced by Filipino small business owners, SME store builder Enstack leverages its extensive knowledge of the difficulties experienced by over 100,000 merchants on its platform to provide an effective solution that businesses can implement today. Their diverse merchant base ranges from fashion, health and beauty, and home and living retail sellers to food business owners and service providers, many of whom previously lacked a proper business management tool to facilitate growth and success.
Super app Enstack paints a realistic picture of why digital payment acceptance remains low among SMEs and how they can facilitate progress:
- Premium P2M Payment Fees: Existing high transaction fees averaging 3% for Person-to-Merchant (P2M) payments pose a significant challenge for small businesses, increasing their operational costs and driving them towards less scalable Person-to-Person (P2P) payment methods. Recognizing this roadblock, Enstack removes payment barriers and offers lower and more manageable transaction fees, empowering all businesses to seamlessly receive digital payments to enhance growth and expansion opportunities, while alleviating the financial strain on SMEs.
- Cumbersome Merchant Payment Account Setup: According to the World Bank, it requires an average of 33 days to set up a business in the Philippines compared to its Southeast Asia neighbors who range from 1.5 days (Singapore) to 16 days (Vietnam). A large part of this is the time-consuming process of setting up merchant payment accounts due to paperwork and complex requirements, which impedes small businesses from entering the digital payment landscape, expanding their customer base, and increasing revenue. Enstack works closely with its payment partners to simplify the onboarding process, requiring only an ID and Proof of Billing to start accepting debit and card payments, while online bank transfers and wallet payments can be facilitated with just an ID from the merchant.
- End-to-End Tools Optimizing Digital Payments: While some businesses have adopted digital payments, many still grapple with manual processes in matching and reconciling orders to payments. Labor-intensive and error-prone, this can result in inaccuracies in both cash and inventory management. Enstack not only provides quick store setup, but also a seamless checkout process, capturing payments for each order made on any of its online or offline sales channels and automatically tagging them to the respective orders for streamlined tracking and management.
“Our mission goes beyond overcoming digitalization roadblocks; we are dedicated to leading Filipinos into a thriving e-commerce ecosystem while helping SMEs turn their business dreams into reality. We share the government’s vision of a digitally empowered nation and aim to provide every Filipino business, regardless of size or industry, access to the tools and resources they need to succeed in the digital landscape. By providing practical solutions tailored to the unique challenges faced by SMEs, we aim to empower them to embrace the benefits of online commerce and maximize their growth potential,” said Macy Castillo, CEO and co-founder at Enstack.
In line with this mission, Enstack is staging its Build-a-Biz competition. Designed to accelerate the adoption of digital sales strategies among SMEs, the competition offers a cash prize of ₱1 million pesos to the SME with the highest grossing sales completed through the Enstack app by the end of the year. For more information, go to www.enstack.com/bab.