Cash on delivery will account for more than 20 percent of Philippine e-commerce transactions through 2027. That keeps the country as Southeast Asia’s most cash-reliant online shopping market, according to payments gateway Xendit.

Physical cash currently represents 23 percent of online transaction value on Xendit’s Philippine platform. That figure outstrips all five other Southeast Asian markets surveyed in its joint report with market research firm Cube.

Across Southeast Asia, cash on delivery is projected to fall below 25 percent of total e-commerce gross merchandise value next year. The Philippines will remain the only major regional market where paper currency holds over a fifth of checkouts.

A persistent unbanked population, limited formal credit, and fear of delivery fraud slow the shift away from cash. In a survey of 6,000 online shoppers across six regional markets, including 1,000 in the Philippines, 12 percent of Filipino buyers said nothing would convince them to stop using cash on delivery. That group is double the size seen in neighboring countries.

Shopper habits are shifting at the margin. About 33 percent of surveyed Philippine consumers reported using cash on delivery less frequently than a year ago. Discounts and cashback offers prompt them to try digital alternatives. Long-term retention still requires fast refunds and fraud protections.

“Looking ahead, across the whole Southeast Asia, COD payments will actually fall below 25 percent of all e-commerce payments, but the Philippines will still probably be one of the fewer markets that are going to be above 20 percent,” said Ina Gatan, head of go-to-market at Xendit Philippines.

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