The big news from Philippines-based Voyager Innovations, owner of the FinTech PayMaya and neobank Maya Bank, is the $210 million venture round announced today (April 12), turning the company into a $1.4 billion unicorn.
Plans for those funds include a plethora of ways to bring better financial services and payments options to a country in which half the population is unbanked. For instance, Maya Bank has added savings accounts and credit offerings for both retail customers and micro- and small- to medium-sized businesses (SMBs), which will join other new features like insurance, micro-investments and cryptocurrency support on its PayMaya app.
That last one may not sound too exciting, but it has the potential to become much more than an afterthought in one of the most crypto-friendly countries in Asia.
What’s interesting is that the addition of those crypto services, which launched last week, jumped right past the ability to buy, sell and hold crypto on PayMaya digital wallets, going straight to a crypto payments offering.
As PayMaya has both electronic money issuer (EMI) and virtual asset services provider (VASP) licenses, PayMaya President Shailesh Baidwan called the crypto launch “a big step up in making crypto accessible to every Filipino through their PayMaya app,” according to the Manila Standard.
“Being at the forefront of digital payments and financial services, expanding into crypto is part of our roadmap as we build the Philippines’ most accessible end-to-end money platform,” Baidwan continued.
PayMaya may be the leader, but it has competition, as smaller Philippines-based NextPay also jumped into crypto last month.
Volatility or Decline
That’s part of a broader trend in which less developed Asian countries — particularly ones without a government-owned fast payments channel — are “quickly adopting cryptocurrency as a tool for payments and remittances” while financial hub countries are strictly regulating and even banning crypto payments outright, the Economist Intelligence Unit (EIU) said last month. There’s good reason for that in the Philippines, where the government takes a benign view of crypto and remittances make up 9% of GDP, the EIU said.
“Cryptocurrency wallets are becoming the preferred tool for such transfers,” it added. “The influence of cryptocurrency in the country is clearly visible.”
The country is No. 15 on blockchain intelligence firm Chainalysis’ “2021 Global Crypto Adoption Index” of crypto-embracing countries — and effectively No. 14 as the list includes China, which has since banned all cryptocurrencies.
It’s not just Asia. The major cryptocurrency exchange KuCoin said this week that about a third of Nigeria’s population has owned or traded crypto in the past six months. It’s also noteworthy that the naira hit record lows against the dollar last fall, Bloomberg News reported, and it hasn’t gotten better.
“In the developing world, there are signs that crypto is quietly building deeper roots,” the Financial Times reported late last year. “Especially in countries which have a history of financial instability or where the barriers to accessing traditional financial products such as bank accounts are high, cryptocurrency use is fast becoming a fact of daily life.”
Then there are remittances, which are also turning to crypto — and bringing recipients at least some familiarity along the way.
“Fifty-one percent of consumers making cross-border P2P payments currently hold cryptocurrency, compared with approximately 12 percent of the general U.S. population,” PYMNTS found in an October study, “The Digital Currency Shift: The Cross-Border Remittances Report,” done in collaboration with Stellar Development Foundation.
That’s despite the price volatility that many regulators, central bankers and financial oversight organizations have decried as making crypto unsuitable for payments.
It isn’t a small problem. The price of bitcoin plunged nearly 15% on April 11. That isn’t great if you want to buy a venti drink at Starbucks, and if it’s what you need to pay for groceries for the week, the kids are going to be tightening their belts.
But where that’s the case regardless, crypto is starting to gain attention as an alternative to already volatile prices.