Who doesn’t love shopping? The Philippines has   nearly 40 million internet users despite having one of the lowest bandwidth connectivity compared to neighboring country in the Asean region, roughly at 3.6 mbps. Despite that the eCommerce is a booming and it’s a huge revenue generating stream for retail and service industry.


Since 2014 the online sales increase 117% and according to one of the leading statistics companies on the internet based in Germany, eCommerce in the Philippines projects a growth rate of 20.67% from 2016 to 2020   resulting to a market volume of mUSD$2.794.

The market’s largest segment is the segment consumer electronics & physical media with a market volume of mUSD 606.7 in 2016. User penetration is at 42.52% in 2016 and is expected to hit 60.90% in 2020.  The average revenue per user   currently amounts to USD 44.70.

These are driven by rising internet proliferation, increasing disposal income and effective online payment system. So how can an online store get a slice of these potential market?

As we all know Philippines has a low credit card penetration, the Credit Card Association of the Philippines (CCAP) said the industry posted modest growth in 2014 only around 7 percent in the total number of cards issued due to stricter regulations from the Bangko Sentral ng Pilipinas.

Read: ML ePay: Online shopping without credit card

CCAP estimated around 7.6 million credit cards have been issued in the Philippines as of December 2013. This translated roughly to 3 million or 4 million credit cardholders, as most Filipinos carry two or three credit cards in their wallets.

Payment Gateway, How does it work?

In order to serve all types of online consumer particularly non-credit card holders Dragonpay offer an online payment platform to merchants, these allow buyers and sellers to conduct e-commerce without the use of traditional credit cards or PayPal. Dragonpay offers a wide range of alternative payment options from over-the-counter to online banking.

Any eCommerce or online shops who wish to provide customers the convenience of a debit-based facility of payment through their banks, these is typically common in your Online Banking. The shopper authorize your banks in behalf of Dragonpay to debit or collect from your account the total amount for all online purchases once they checkout in the online shop.

Currently supported banks include BDO, BPI, Metrobank, RCBC, Unionbank, UCPB, Chinabank, PNB, Maybank, RobinsonsBank, Sterling Bank of Asia, and EastWest Bank.

Another payment option is Over-the-Counter (OTC) wherein online shoppers upon checkout, need to go directly to Dragonpay’s accredited receiving bank. Currently banks for over-the-counter deposit are Banco de Oro, Bank of the Philippine Islands, Metrobank, Rizal Commercial Banking Corp, Chinabank, EastWest Bank, Landbank, Maybank, Philippine National Bank, RobinsonsBank, Security Bank, Sterling Bank of Asia, United Coconut Planters Bank, and Unionbank.


What normally happens is that once you’ve checkout a transaction number will be generated by the online shop. Thus, using this reference number you need to make a payment/deposit infavor of Dragonpay. Dragonpay will then communicate with the merchant that a shopper had paid the purchases stated on the reference number.

The interesting aspect for both Merchant and Shopper’s point of view is that payments made thru Dragonpay is automatically validated. It means that Merchants no longer need to ask for a copy of deposit or payment slips from the shopper, which is basically a hassle and time consuming. The shopper just need to wait for the shipment confirmation from the Merchant.

Another potential type of shopper that Dragopay served are those consumers who wish to pay Over-the-Counter Non-Bank.

In case a shopper doesn’t owns a bank account or just prefer to pay over-the-counter non-bank this is feasible as well. Bayad Center, LBC branches, SM Payment Counters, Robinsons Department Stores, Cebuana Lhuillier and M.Lhuillier branches nationwide accepts these payment transactions.

It is very convenient since these OTC-Non Banks have more branches combine, unlike banks these outlets open on weekends and some branches operates 24 hours.

They also launched payments thru remittances in partnership with I-Remit, PNB Remit and Ventaja. This is very ideal for eCommerce retailers whose customers are Filipinos overseas.

Merchant’s requirements to use Dragonpay’s services

Any online retailer or eCommerce who wish to use their platform needs submit the following

  • Filled-up application form
  • DTI or SEC papers with Articles of Incorporation & By Laws
  • BIR Certificate of Registration
  • Latest business permits (mayor’s permit, BIR, etc.)
  • Any utility billing showing your registered address
  • Scanned copy of passbook showing the account name and account number of the settlement account
  • Three (3) copies of originally signed MOA

What are the fees?

Dragonpay collects a one-time setup fee and charged per transaction fees thereafter

  • P10 – if payment made via online banking
  • P15 – if payment made over-the-counter (OTC) at a bank or via ATM
  • P20 – if payment made via OTC non-bank
Payment Type Standard Fee Micropayments Fee
Online Bank Debit P 10 / txn 5%
OTC Bank Deposit P 15 / txn 5%
OTC Non-traditional P 20 / txn n.a.

 

Micropayment is ideal if the online sales transaction is P200 or less.  However, it is limited to certain channels only. According to Dragopay non-bank partners (LBC, SM Payment Counters, M. Lhuillier, and etc.) are not available for Micropayments Plan. Dragonpay is a Platinum PayPal Partner and they can provide you with PayPal integration services at no additional cost.

Systems Integration

Once submission of all the necessary documents, paid the required fees, concluded all formalities and had been approved, Dragonpay will provide all credentials with a Test Merchant Account in which your IT guys’ can start with the integration of Dragonpay’s payment solution to the Merchant online shop.

Arnel M. Salvador is working as a Consultant in an Enterprise Resource Planning (ERP) Software Company based in Singapore. A hobbyist photographer and blogger whose penchant in writing started since he was in the University. Arnel likes to travel and immerse to cultural diversity, amused himself to technological innovations and reading current events online. He believes everybody should dream big and has a story to tell so share it. Presently he is busy in the eCommerce start-up he founded named Royal Beaver Online.

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