Although digital payments in the Philippines surpassed half of total transaction volumes in 2024, business-led digital adoption remains modest. According to the Bangko Sentral ng Pilipinas (BSP) Status of Digital Payments in the Philippines, business-to-business (B2B) and supplier payments accounted for just over 6% of digital transaction volume, compared with more than 70% for person-to-person and retail payments. This illustrates the structural challenge for local cash management banks — helping businesses digitise payment flows that remain predominantly cash-based. Balancing physical access with digital innovation The Philippines’ geography, uneven internet access and entrenched cash-handling practices have kept physical collection and disbursement relevant. Many corporates and SMEs therefore demand a blend of branch, cash-handling and digital capabilities, where physical infrastructure provides reach and reliability, and digital tools enable efficiency and visibility. BDO Unibank’s cash-management franchise has expanded rapidly within this hybrid environment. The bank has installed more than 1,200 corporate cash-deposit and recycling machines and 300 remote cheque scanners nationwide. These machines enable clients — particularly retailers and distributors — to credit cash to their accounts directly from their premises, cutting the need for branch visits or armoured transport. The recycling feature dispenses cash for disbursements, reducing handling and reconciliation costs. Remote cheque scanners, meanwhile, digitise cheque clearing from client offices, accelerating clearing and settlement. Together, these channels make cash management faster, safer and more transparent, offering real-time account credit without branch visits. Carlo Nazareno, BDO Unibank’s head of cash management services, describes the task as “translating corporate banking concepts into language that resonates with small firms.” Many local businesses are unfamiliar with liquidity management or automation, so the bank packages cash-flow tools in practical terms—showing retailers or distributors how faster deposits, payroll automation and remote cheque clearing can shorten settlement cycles and reduce idle funds. This infrastructure also eases congestion in bank branches, where digital kiosks and on-site staff guide customers through online processes. Enhancing cash management services (CMS) to match global standards As corporates demand real-time information, banks are deepening integration between enterprise resource planning (ERP) systems and bank platforms. BDO Unibank has been rolling out ISO 20022-compliant payment messaging and expanded API connectivity to improve straight-through processing within its cash management services (CMS). The bank implemented a comprehensive mandate for a multinational retail clothing brand operating in the Philippines. Using enhanced CMS, BDO Unibank integrated collection, deposit and reconciliation processes aligned with the brand’s global banking templates. The system provides real-time account visibility, automated credit posting from cash-deposit machines and streamlined sweep and pooling functions to consolidate excess funds daily. The solution addressed key pain points — manual cash consolidation, delayed reconciliation and fragmented account management — by enabling centralised daily reporting and electronic fund transfers via API and host-to-host connectivity. Automated matching of transactions with store-level deposits ensured each store’s inflows were accurately recorded without manual intervention. Combining physical cash collection infrastructure with digital integration, the project demonstrated BDO’s ability to align global cash-management standards with local market needs. Yet, it also revealed challenges in harmonising data formats with international templates required for global reporting cycles and audit standards. “Standardisation is still incomplete—different clearing houses use the ISO format differently. BSP has been in conversations and is meant to publish a policy circular for banks and the clearing houses to standardise,” Nazareno said. Payroll solution driving customer stickiness Demand for payroll propositions remains strong as corporates seek to automate salary disbursement, ensure compliance and cut manual processing. For many employees, payroll accounts are their first step into the formal financial system, supporting BSP’s inclusion goals. BDO Unibank’s payroll solutions illustrate how deposit growth and customer “stickiness” intersect. Beyond salary disbursement, the bank bundles employee accounts with access to insurance, credit cards and personal-loan facilities. For employers, this simplifies administration; for staff, it creates a broader relationship with the bank, encouraging balances to remain within the system. Nazareno sees this as a shift from fee extraction to fostering long-term relationship. “The long game is owning the account—of both corporate and employee”, he concluded. BSP’s digital finance roadmap aimed for 70% account ownership by 2023, but penetration stood at around 55% in 2024 — highlighting the task of unfinished inclusion. For BDO Unibank, this gap represents opportunity. By linking physical networks with digital rails, the bank is positioning itself as an early mover—turning digital standards into customer-centric solutions for a still cash-reliant economy.
