A couple of years ago, during my daily walk around the University of the Philippines oval, I felt thirsty and realized I had no money with me. My granddaughter Julia, who was walking with me, said I could pay with my phone. “You have GCash, don’t you, Lolo?” I did, but a bottle of water cost only P30, and it seemed inappropriate to make a digital transfer for such a small amount. Every student does it, she assured me. Only then did I notice the card bearing a QR code in front of nearly every stall on campus.
For most of my adult life, I paid with credit cards and worried about settling the bill on time. The debit card was more convenient, but then it left your entire bank account exposed to unauthorized payments and scams. The e-wallet, like GCash and Maya, removes that worry: you keep only a small amount in it and can spend no more than it holds. The payor pays no extra charge; it is the vendor who pays a small fee for the service.
Today, QR payment is everywhere. GCash and Maya still dominate, but the banks have joined in; every mobile banking app in use now has a QR button. This is possible because the code is a national standard. It’s called One QR PH, an initiative of the Bangko Sentral ng Pilipinas (BSP), which any bank or wallet can read. By the BSP’s count, digital transactions made up nearly two-thirds of retail payments by volume last year, up from a fifth in 2020. In many ways, we have half-consciously walked into a digitalized financial system that is fast becoming the norm in many parts of the world.
I saw a more advanced version of it on a recent visit to China. My Singapore-based grandchildren wanted to see the pandas in Chengdu, and I joined them to get a glimpse, however fleeting, of modern China itself. We explored Chengdu and Chongqing on our own, which meant downloading Alipay and WeChat before we arrived, and activating them later with a scanned passport and a linked card. You cannot travel around China without them; cash is still accepted, but it has become the exception. Unlike our single QR national standard, however, these two giants use distinct QR codes. Most shops display both. Efforts to make them interoperable have only begun.
Our first dinner, at a small Hong Kong-style restaurant in Chongqing, showed me what the technology does beyond payment. A waitress pointed to the QR code sticker on our table and said something in Chinese. Xavier, my older grandson, who studies Mandarin in Singapore, translated: she wanted us to scan the code with WeChat or Alipay. The menu opened instantly, and we ticked off the dishes we wanted. The waitress brought us glasses of warm water and chatted with the children, but she would not take our order. When we were done ordering, the same app led us to the payment page, and a few minutes later the dishes arrived. When we wanted extra servings, the servers again pointed to the QR code to order and to pay. It was like ordering Grab Food, except that we were sitting in the restaurant.
The system failed me only once. A ride payment did not go through because my card needed an OTP that had been sent through Viber, which I failed to see. In near panic, I found that WeChat lets you ask a contact in your list (WeChat is also a social media platform) to pay your bill. The contact approved, and that was that. It struck me that this faceless system had, in the end, found a place for a real person.
It is an amazing technology, and it is already here. I think we cannot avoid integrating it into our daily lives as the economy becomes more complex and differentiated. But as GCash, perhaps the closest equivalent of Alipay, prepares to launch its IPO later this month, two obstacles are worth noting. The first is infrastructure. Even on the University of the Philippines campus, a payment often fails because of weak internet connection; outside Metro Manila, the network completely vanishes the moment the power is cut. The second is trust. Nothing deters Filipinos from using their phones to make payments more than unauthorized charges against their accounts. No one has measured the fraud, but it must be pervasive; otherwise, banks would not be sending almost daily warnings not to share passwords.
Banks and other financial entities are now liable for fraudulent transactions, but not when account owners themselves hand over their passwords or passkeys. That exception says a lot. Trust among persons is cultivated through norm-setting and institutionalization. When it is transferred from persons to systems, it rests less on knowing anyone than on knowing that someone is ultimately answerable when things fail. The exception leaves out precisely the scams that are able to manipulate victims to authorize the payment themselves.
One can only imagine how much faith it takes to entrust one’s money to an automated system whose workings one barely understands. At that Chongqing restaurant, the waitress lingered a while after bringing us warm water. The system had taken over her work in the transaction chain, but not her courtesy. That arrangement is what is fast becoming the norm: systems for the specialized transactions, persons for the remaining face-to-face hospitality.
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