CASH-ON-DELIVERY (COD) use in the Philippines was the highest in Southeast Asia, with at least one in five Filipino consumers relying on it despite the acceleration of digital payments, a report by payments infrastructure company Xendit showed.
In a study it co-authored with e-commerce analytics company Cube, Xendit said about 23% of Filipino consumers still opt for cash-on-delivery for their online purchases, the highest in the region.
“The Philippines is going digital. We see this very, very clearly, and we’ve been seeing it for the past two years. But cash still holds on,” Xendit Head of Go-To-Market for the Philippines Ina Gatan said at a briefing on Thursday.
This came even as digital payments, particularly those made via quick-response (QR) codes and bank transfers, in local e-commerce platforms surged by 198% from January 2025 to April 2026.
“I think the first number that we want to highlight here is 198% growth — from January of 2025 until April of this year, we saw 198% increase in QR and bank transfer payments across our platform, very specifically,” Ms. Gatan said. “However, still with that growth, we’re still seeing that about 20% of e-commerce transactions are still cash-on-delivery payments.”
However, 33% of the 1,000 Filipinos surveyed said they now use COD less than they did a year ago.
“While one-third of Filipino respondents say they are using COD much less, 12% still say they prefer COD and nothing would encourage them to switch, around twice the level seen in most other markets,” Xendit said in its E-Commerce Payments Momentum Report 2026.
Cube sees COD payments falling below 25% of Southeast Asian countries’ total e-commerce value by 2027, but noted that the Philippines could be among the outliers with above 20%.
Filipinos who were adamant about sticking with COD payment said they could go digital if platforms offer incentives such as discounts or cashbacks.
However, Ms. Gatan said making buyers’ preferred payment methods readily available and accessible will be crucial to retaining those who have switched.
This is as the report found that Filipino consumers prioritize diverse payment options, with 41% saying they dropped their purchase when their preferred method was unavailable.
This, Ms. Gatan added, is Filipino consumers’ top frustration in digital payments adoption, followed by security.
“For merchants, this means improving conversion requires a market-specific approach: broader payment coverage in some markets, stronger trust and security in others, and a simpler checkout experience where friction is the bigger barrier,” the report read.
According to Xendit, e-wallet giant GCash remained as the most used payment platform by Filipino consumers.
Meanwhile, the report also found that 92% of businesses surveyed said a broad range of payment options is vital to their growth.
However, a significantly smaller share of firms (12%) said their payment infrastructure is fully prepared for the next decade.
Among the business leaders surveyed, only 8% also cited fraud as their current top concern, but the share rose to 48% for those who expect it to become their leading concern within the next five years.
“For Philippine merchants, the next few years will mean managing three shifts at once: fast growth in realtime payments, a cash habit that is fading more slowly than elsewhere in the region, and fraud moving up business leaders’ list of concerns,” Xendit said in a statement.
“The checkouts that hold on to sales will be the ones that offer the full range of ways Filipinos pay, with security built into each of them from the start.”
Digital payments accounted for 64.7% of the total volume of retail payments in the Philippines in 2025, higher than the 57.4% in 2024, central bank data showed. This marked the first time that the share settled within the regulator’s 60%-70% target in line with the Philippine Development Plan. — Katherine K. Chan