Report: 70 Million Filipinos Have E-Wallets but Fewer Own Bank Accounts Since 2021
Kaya Founders' study showed that Filipinos holding bank accounts fell to 34 percent in 2024 from 46 percent in 2021.
by JV Ordoñez
Published on Apr 13, 2026
More Filipinos are storing their money in e-wallet accounts than ever before, with users surging to 70 million last year. But as these digital financial applications take over and the local fintech sector sees spurs in investment, only 34 percent hold actual bank accounts in 2024, down from 46 percent in 2021, according to a report by Manila-based early venture capital firm Kaya Founders.
"The Philippine Fintech Stack 2026," published this month, said that Manila is building financial apps faster than existing infrastructure can keep up with, or risk fewer Filipinos building a financial standing that attaining formal credit requires.
The drop in bank ownership was drawn from last year's World Bank's Global Findex Database that saw the aforementioned surge in e-wallet users and the tripling of digital payment volumes. These e-wallets are undeniably the future of consumption and payment schemes, but these don't really cover bases such as building credit history necessary for loans especially for small businesses. While these e-wallet services offer similar loan options, these usually are limited to smaller amounts that won't be enough for most business lending.
"The ecosystem is over-distributed and under-infrastructured. Applications have scaled faster than the shared rails that make financial services cheap, reliable, and durable," said Connor Wen, a fintech operator and investor who penned the report. "Apps are plentiful but the rails are thin."
The report also cited World Bank data that showed a gap between Manila and its neighbors in financing for small and medium enterprises at 76 percent of the country's gross domestic product. This illustrates how much businesses need to borrow and what banks will actually lend them. Against its neighbors, Thailand has an equivalent gap of 10 percent of its GDP, while Indonesia's is at 19 percent.
Small business loans account for just 4.1 percent of Philippine bank portfolios compared to 20.1 percent in Thailand and 20.6 percent in Indonesia, according to the Asian Development Bank's 2024 Small Medium Enterprise Monitor. The report noted that lenders cite approval rates for loans of as low as one percent.
Government data shows that micro, small, and medium enterprises account for about 99.5 percent of all establishments in the Philippines that still find it difficult to pay their employee salaries on time due to cash flow constraints and high operational costs. A restricted access to formal credit caused by this overreliance on e-wallets may affect roughly 63 percent of the total Philippine workforce, which are from these businesses, based on data from the Philippine Statistics Authority.
In the report's preface, Kaya Founders general partner and former Lazada Chief Executive Officer Ray Alimuring said basic inefficiencies in the local financial system infrastructure highlight something much deeper than the Filipino cultural habit of adaptation.
"Too often, we attribute too much weight to Filipino cultural behavior. But Filipinos seem to adapt remarkably when placed in different settings, suggesting far more complex underlying dynamics. These counter-intuitive questions often conceal structural gaps, entrenched players protecting their positions, or opaque economic incentives," he said. "That Philippine fintech has lagged its Asian neighbors also presents a way forward. Filipinos have long demonstrated an ability to learn and adapt."
Where the Bridges Need to Be Built
There are a bunch of different shortcomings Manila has to look out for if it wants to boost its verification and overall environment for consumer trust. The study cited the limited use of the country's simplified national ID system, PhilSys, which banks and financial companies should use to confirm a customer's identity in a relatively quick and inexpensive manner.
About 150 organizations have signed up to use this state service, with most treating the national ID as a photocopy-and-keep-on-file type of deal. But banks and financial apps still run their own proprietary verification processes and tedious document requirements with their own vendors.
These requirements often cost the customer hundreds to over a thousand pesos to process instead of just relying on the fairly new PhilSys system.
"Identity, the most basic unit of trust, remains costly to establish and easy to work around," according to the Kaya Founders report.
Another gap is the expensive InstaPay money transfer system, which was launched in 2018. Manila's national cashless transfer system costs between 10 to 25 pesos per transaction, while countries like India and Brazil have national transfer schemes that charge close to nothing. The report noted that Filipinos average at least three InstaPay transactions per month against 14 for India and 25 for Brazil, drawing from data from the central bank Bangko Sentral ng Pilipinas, India's Press Information Bureau, and Banco Central do Brasil.
Less than a fifth of the country's banks and e-money issuers participate in InstaPay at all. From the 93 institutions that do, only 61 allow QR code transfers between people, 49 allow QR payments to merchants, and 29 support bill payments, based on data from the report. The Philippine central bank's numbers also show that InstaPay volumes surged to 4.6 billion transactions from 1.4 billion between 2024 and 2025, showing an increased appetite for the convenience even if it costs a bit more to transfer money.
Wen also noted that one of InstaPay's most common uses today is just Filipinos topping up their own e-wallets. "The sole real-time payments switch is largely being utilized by users to transfer funds to themselves, instead of for payments," the fintech operator who moved to the Philippines last year said.
Lastly, the report noted a gap in credit data. When someone applies for a loan in the Philippines, lenders usually have no way of knowing a person's existing loans elsewhere or getting the full picture of whether this person is trustworthy or not. For some background, there is a national credit registry, the Credit Information Corporation, though it has been criticized for having limited coverage, with consumers and small business lenders reporting default rates of about 20 to 30 percent.
"By borrowing best practices from comparable markets, strategies that have been tried, tested, and refined, we can significantly shorten our learning curve," according to Alimurung.
"Why, in 2026, are we still writing a million checks a month? Why is e-commerce predominantly COD? Why are consumer and MSME interest rates sky-high despite the explosion of lending apps and fintech companies? Why is it so easy to open and use an e-wallet, but not a bank account? And, my personal pet peeve, why do we need to send screenshots to prove we've paid?"
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