The Department of Trade and Industry collaborates with JustPayto
The Department of Trade and Industry (DTI) has partnered with JustPayto, a Philippines-based financial technology firm, to offer digital payments to micro, small and medium enterprises.
According to the DTI, all interested DTI-registered businesses will be included in the fintech’s platform as a result of the collaboration with JustPayto. Registered businesses registered with JustPayto will be able to make bank transfers, electronic wallets, Visa and Mastercard credit and debit cards, both online and in person.
Also, micro, small and medium enterprises (MSMEs) will be able to track their cash flow while establishing their credit history for future loans. JustPayto will also hold presentations and workshops on entrepreneurship in several areas.
DTI seeks to bring about the economy’s digital transformation, and emphasizes that MSMEs should be digitally driven businesses that need support during the transition.
JustPayto was established in 2016 and is licensed and regulated by the Bangko Sentral ng Pilipinas, as well as registered with the Securities and Exchange Commission. With JustPayto, users can accept a variety of payments without having to deal with different banks or complicated apps.
The role of digital payments in the MSME market
As the digital payments ecosystem continues to grow, with businesses and individuals adopting digital instruments, the MSME industry has also started talking about the digital payments initiative. Thus, MSMEs have increasingly recognized the importance of adopting digital technology to reduce the inconvenience to their customers and suppliers, reduce the administrative burden on their business, as well as minimize the risk of losing important records. And digitization of payments is a necessary part of that story.
MSME digitization has a number of benefits including improved cash flow, faster realization of funds and increased store cost efficiency. Better understanding of consumption patterns and eradication of bad debts will both be facilitated by computerized registration of payment transactions.
The digital payments ecosystem can undoubtedly unlock massive value for MSMEs by helping them expand their customer base and offer upsell opportunities, reduce costs and create a digital footprint that will enable easy access to credit at cheaper rates.
The MSME sector in the Philippines
MSMEs constitute 99.5% of the total Philippine enterprises. They contribute to 35.7% of total value creation in 2020, 60% of all exports, representing 25% of total export earnings, and support 62.7% of total employment.
MSMEs in Southeast Asian economies largely target local markets, and their levels of entrepreneurship remain below average. Supporting the growth of MSMEs, especially in terms of technology adoption and involvement in global supply chains, can help promote inclusive growth.
For example, MSMEs are said to have the ability to increase employment. 72% to 85% of MSMEs in Southeast Asia are located in rural areas. They employ between 70% and 84% of MSME workers in their respective countries. Their development is therefore essential to provide jobs to the unemployed or informal workforce.
The development of entrepreneurship, especially in the service sector of MSME, which turns out to be low-tech and domestically focused, will enable inclusive growth in the developing region of Asia.