TRANSACTIONS using QR Ph and InstaPay grew 198 percent from January 2025 to April 2026, but cash-on-delivery (COD) continued to account for nearly a quarter of Philippine e-commerce payment value, highlighting the challenge of moving more online shoppers to digital payments.
The findings are from the Ecommerce Payments Momentum Report 2026, developed by payments platform Xendit and e-commerce data firm Cube. The report examines consumer payment preferences, merchant concerns and the changing digital payments landscape in six Southeast Asian markets.
The study draws on a survey of 6,000 online shoppers, including 1,000 respondents from the Philippines, a survey of 25 business leaders, platform transaction data, merchant interviews and other sources.
The report’s transaction figures reflect activity on Xendit’s platform and should not be interpreted as total market volumes unless specifically stated.
QR payments gain ground
QR Ph and InstaPay transactions on the platform increased 198 percent between January 2025 and April 2026, accounting for about 13 percent of Philippine e-commerce payment value recorded in the data.
The increase points to growing use of real-time payment options as consumers and merchants adopt alternatives to traditional payment methods. However, the report found that growth across digital payment channels was uneven.
E-wallet payments on the platform increased by 3 percent over the same period. GCash remained dominant in the Philippines’ wallet-first payment market, according to the report.
A survey of business leaders also identified QR payments as the method most frequently cited as experiencing the strongest increase in demand. Thirty-two percent of respondents selected QR payments, while e-wallets and bank transfers were each cited by 20 percent. Buy now, pay later services accounted for 16 percent, and credit cards for 12 percent.
The findings suggest that merchants need to accommodate different payment preferences rather than rely on a single digital option.
“Filipino consumers have always been receptive to new technology and we see the same in digital payment, but they don’t all pay the same way. One wants an e-wallet, another scans a QR Ph code, another uses a card,” said Nazim Ali, president of Xendit.
“So for a business, going digital isn’t about choosing one main payment method and steering everyone onto it. It’s knowing which methods your digitally savvy customers actually use, offering those, and making sure each one is secure. If people can’t find the option they use, or don’t trust the checkout, they leave.”
Cash-on-delivery remains significant
Despite the increase in QR-based transactions, COD accounted for about 23 percent of Philippine e-commerce payment value in the platform data, the highest share among the six markets covered by the report. Vietnam followed at about 16 percent.
The report expects the Philippines to be the only market among those surveyed where COD will remain above 20 percent of e-commerce payment value in 2027.
Consumer responses indicate that the payment method remains difficult to displace. Thirty-three percent of Filipino respondents said they used COD much less than they did a year earlier. However, 12 percent said nothing would persuade them to switch from COD to digital payments, approximately twice the level reported in most other markets.
Discounts and cashback were the most commonly cited incentives for switching from COD to digital payments across the six markets
The findings point to a continuing need to address consumer concerns and provide practical reasons to change payment habits. Although digital options are gaining ground, some shoppers remain attached to COD, making it important for merchants to maintain payment choices that match customer expectations.
Payment options affect completed sales
Payment availability can also determine whether shoppers finish an online purchase.
Forty-one percent of Filipino respondents said their main reason for abandoning an online purchase in the previous three months was that their preferred payment method was unavailable.
Indonesia recorded a higher share, at 51 percent, while Malaysia registered 31 percent. In Vietnam and Thailand, security concerns were the leading reasons for abandoning purchases, cited by 42 percent and 33 percent of respondents, respectively. In Singapore, 26 percent said too many checkout steps prompted them to leave.
The differences show that barriers to completing purchases vary by market. In the Philippines, the absence of a preferred payment option was the leading issue identified by respondents.
For businesses, offering multiple payment methods may help reduce friction during checkout. However, a wider selection also requires systems that can process transactions reliably and protect payment information.
Among the surveyed business leaders, 92 percent said payment method diversity was important or critical to growth. Thirty-six percent described it as critical and said they could lose sales without it. IRA JAMES
Only 12 percent considered their payment infrastructure fully prepared for the next decade of growth, indicating a gap between the importance businesses place on payment options and their confidence in existing systems.
The business leader survey involved only 25 respondents, so its findings should be treated as directional rather than representative of the entire regional market.
Fraud concerns expected to grow
Payment security is another concern for businesses as digital transactions expand.
Only 8 percent of surveyed business leaders ranked fraud among their top two payment concerns today. However, 48 percent expected it to become a major concern within five years, a six-fold increase.
The report also estimated that issuers decline about one in 10 e-commerce dollars during authorization, including some transactions that are legitimate. Such declines can prevent genuine customers from completing purchases, while inadequate fraud controls can expose merchants and consumers to financial losses.
The findings highlight the need to balance fraud prevention with the ability to approve legitimate transactions. Businesses expanding their digital payment options must also consider the reliability and security of the systems supporting them.
Across Southeast Asia, payment systems are becoming more connected across borders, but consumer preferences continue to differ by market. The report’s findings suggest that Philippine e-commerce businesses face a two-part challenge: expanding digital payment adoption while accommodating shoppers who still prefer COD.
The continued use of cash on delivery, alongside the growth of QR payments and other digital methods, indicates that the transition will depend not only on the availability of technology but also on payment choice, consumer confidence and checkout reliability.
