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Digital Innovation in the Philippines

Digital Innovation in the PhilippinesInternet usage in the Philippines has tripled since 2010, with 73 million users as of 2020. Filipinos reportedly spend almost 10 hours daily surfing the internet and using social media. The Digital Economy has shown significant growth since 2018, and there is still potential for further development.

In 2020, when COVID-19 hit the Philippines, it highlighted the need for improved digital infrastructure across the country to aid in its economic recovery. However, it was evident that many individuals and businesses had poor internet connectivity and usage. To recover from the financial impact of COVID-19 and work toward a vision of a poverty-free society by 2040, the Philippines aimed to harness the potential of an efficient digital infrastructure that would transform how the country conducted business.

The Digital Divide

In the Philippines, over half of the population is considered internet-poor due to the Digital Divide. This factors in their ability to afford the minimum mobile phone package, which means that more than 58 million Filipinos cannot purchase one gigabyte of mobile data per month.

The Philippines aimed to initiate a new era of digital innovation, which required connecting most rural households to the internet and promoting its use to achieve an inclusive, productive digital economy. This would also support the country’s goal of significantly reducing poverty.

Policies to Facilitate the Digital Economy

In a bid to provide internet connectivity throughout the country, the government focused on creating an affordable, efficient and accessible digital infrastructure for both businesses and individuals. These policies aimed to make the use of digital markets accessible and cost-effective. Also, the government had to encourage the adoption of digital platforms in a country that had traditionally relied on analog methods of doing business. The following are strategies the government implemented to achieve the digital economy goals.

  1. Promoting Digital Payments: To increase the use of online markets and e-commerce platforms, the government had to increase the usage and familiarity with digital payments, such as Google Pay. In a country with low bank account ownership and heavy usage of cash notes for transactions, this shift to ‘e-money’ was challenging yet vital to ensuring the digital market’s take-off. To achieve this, government agencies made online bill payments mandatory.
  2. Reducing logistical e-commerce costs: To promote the use of e-commerce websites that trade internationally, the government aimed to reduce the legal confusion and logistical constraints that often hindered imports and exports across the Filipino border. They implemented policies that reduced the costs of items at market entry and customs, making e-commerce more accessible for sellers and cost-effective, ultimately increasing the income of small and medium-sized enterprises (SMEs).
  3. Providing IT skills for businesses: There was a need to equip businesses and individuals with the appropriate skills to facilitate the maximum utility of the new digital infrastructure. Therefore, the government provided start-up workshops and IT skill training to employers and workers, teaching them how to handle digital information correctly. The multinational technology company Google provided some of the required training.

Impacts so Far

Looking at the everyday lives of Filipinos can offer some insights into the impact of  Digital Innovation in the Philippines. For decades, the Digital Divide caused significant inequalities in access to social and economic services. In recent times, however, there have been hopes of minimizing or alleviating such inequalities through ongoing efforts.

For many of the country’s citizens, better internet access opens up the paths to socio-economic opportunities in the online world. And this also applies to those living in rural areas.

The economic significance of improved digital infrastructure is also evident in the steady increase of the Digital Economy’s GDP share value. Digital innovation in the Philippines has led to more inclusive and productive growth, encouraging greater participation from previously excluded individuals. Additionally, opening new markets for people and SMEs has increased cash flows, pushing the country closer to its goal of reducing poverty.

Google services, specifically Google Pay and Google Ads, have also played a significant role in digital innovation in the Philippines by providing businesses and workers with IT training and safe internet practices. Their services have been said to have had a prominent influence on the country’s financial economy post-pandemic.

The Future of Digitalization

Digital innovation in the Philippines continues to positively impact the country’s economy by equipping individuals and businesses with digital capabilities while connecting different regions to broader international markets. It is also promoting the use of e-commerce platforms, leading to higher productivity and inclusivity. While it is yet to fulfill the goal of creating a poverty-free Filipino society, the results so far signal hope for the future.

– Ariana Mortazavi
Photo: Flickr

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Tech Platforms Increasing Accessibility in India

accessibility in IndiaAs of 2020, 50% of people in India had access to the internet, a figure growing most quickly in rural regions. In 2019, there were 264 million internet users in rural India compared to the 310 million internet users in urban India. The rapid growth of internet adoption outside of Indian cities can be accredited in part to the initiatives of the Digital India campaign, including efforts to integrate the country’s cloud infrastructure, promote open data platforms, fill connectivity gaps and offer affordable data plans. Overall, internet penetration rates across the country have more than doubled over the last five years. Through the use of technology and the internet, platforms have been created to increase resource, service and opportunity accessibility in India.

The Digital Revolution Increases Accessibility

In a country where 80% of the impoverished live in rural areas, widespread internet availability is vital. More than just a source of entertainment, the internet increases accessibility of products and services that otherwise might not be affordable or available. Recognizing the potential for digital technologies to cut across geographic and economic barriers, numerous private and public organizations have developed platforms designed to increase accessibility in India. Whether connecting buyers to faraway sellers or simply helping individuals locate public toilets, these innovative tech platforms champion access and promote inclusion in India.

Google Toilet Locator

In 2012, more Indian households had a cellphone than a toilet. A lack of access to toilets leads to rampant open defecation with consequences ranging from water pollution to the spread of infectious diseases such as cholera. In a country where technology has grown faster than public services, the government turned to tech for assistance in its campaign to eradicate open defecation and improve waste management. In December 2016, India’s Ministry of Urban Development (MoUD) partnered with Google to introduce a Google Maps toilet finder tool as part of the Swachh Bharat (Clean India) Mission. As the government works to construct millions of toilets around the country, the Google Toilet Locator helps Indians to more easily find them. The app even allows users to leave ratings and reviews for public restrooms.

Tractors-as-a-Service

In September 2018, Aeris Communications partnered with Hello Tractor to launch “Tractors-as-a-Service” in India, The service provides on-demand tractor rentals to Indian farmers. In India, agriculture is an essential source of export earnings, employment and food. Tractors play a crucial role in increasing agricultural productivity but less than 30% of farmers utilize such expensive, high-capacity equipment. Hello Tractor’s software, which can be accessed through mobile and web applications, offers a “pay-as-you-use” model based on time in the field and area covered. The app enables small farmers to reap the benefits of commercial model tractors at lower costs while increasing the profits of tractor owners by allowing them to rent out their machines during idle times.

IndiaMART

IndiaMART is India’s largest online business-to-business marketplace, connecting buyers with suppliers of products and services ranging from pharmaceuticals to industrial machinery to wholesale foods. IndiaMART offers more than 67 million products and services to more than 100 million buyers. Importantly, the platform gives small and medium-sized enterprises in India a place to promote their business. There are about 60 million small and medium-sized businesses in India but only around 10 million of them have any web presence, according to the most recent data. IndiaMART allows these companies to expand their market reach and sell through the platform for a subscription fee.

A thriving e-commerce economy allows for goods and services to reach a consumer base that is less affluent and lives outside of traditional urban markets, thereby increasing market accessibility and enhancing the welfare of rural and lower-income populations.

Unified Payments Interface

In the financial sector, the National Payments Corporation of India developed the Unified Payments Interface (UPI), an instant real-time payment system regulated by the Reserve Bank of India. The platform allows users to access multiple bank accounts from even the most remote locations, routing funds and making payments under one seamless application. Digital finance platforms such as UPI are crucial in promoting financial inclusion and empowering individuals with tools such as loans and savings accounts.

Both private and public digital platforms have been deployed to increase accessibility in India and reach those who may otherwise be excluded from resources, services and opportunities.

– Margot Seidel
Photo: Flickr

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How Jio Transformed Internet Access in India

Internet Access in IndiaGrowing internet access has the potential to transform the lives of India’s 270 million poor people. A country of almost 1.4 billion, India has seen tremendous technological and economic growth over the past 20 years. Until recently, the lack of pervasive and affordable mobile coverage served to limit internet access in India. Most regions still relied on 2G technology and only 9% of rural Indians had reliable mobile internet access as recently as 2015. Jio Platforms, launched in 2016 by Reliance Industries, was the country’s first nationwide 4G network. It is a disruptive telecommunications company that facilitates innovation in India by expanding internet access in an affordable way.

High Speed, Affordable Internet

Jio was launched in 2015 by Indian billionaire, Mukesh Ambani, as a part of his $125 billion company, Reliance Industries. With deep sources of funding, Jio could afford to invest over $22.5 billion. This would go toward an ambitious plan to build a nationwide 4G mobile. Unlike 2G and 3G, 4G technology handles both data and voice in the same, data-efficient way and offers cheaper and faster speeds. This has made 4G technology the backbone of the modern internet. It enables the speed and instant connectivity required for tasks like streaming videos or online banking.

After it launched, Jio gained customers by giving them access to its 4G network entirely for free in 2016. It has since introduced rates that start as low as $1 a month and scale to offer gigabytes of data for just a few dollars. Along with the mobile network, Jio has built an online ecosystem and sells its own 4G smartphone. Customers can acquire smartphones for as little as a $20 deposit. Jio’s low prices have been a complete gamechanger for the hundreds of millions of Indians who previously couldn’t afford an expensive data plan.

Over the past four years, Jio has gained almost 400 million subscribers and became the largest mobile network on the planet. With the tremendous scale and 4G infrastructure, Jio has been able to make money while upending the Indian mobile market. Competitors have been forced to cut prices to compete, leading to a 35% drop in revenue in the industry over the past two years despite an expanding market.

What it All Means for India

Jio has fundamentally transformed what internet access in India looks like for hundreds of millions of people. Access to the internet in rural areas has tripled since 2015 and is growing at a rate of 35% a year. As a result of Jio’s prices and 4G infrastructure, analysts estimate that the average internet user has gone from using 700MB of data a month to 11GB. This means that more people are accessing sites such as YouTube, for which India is currently the fastest-growing market.

Currently, 80% of poor people in India live in rural areas. Rapid growth in internet access stands to shorten the opportunity gap between urban and rural areas. In recent years, there has been a boom in tech companies innovating in e-commerce. They have also been innovating in financial services and entertainment among other things. For many people in rural areas, access to the internet also means access to services that can improve their quality of life. These services include online education programs.

Just the Beginning

For all of Jio’s success, 627 million people in India are internet users. It is expected that millions more will be online over the next few years. Google, Facebook and other American tech companies have announced over $20 billion in investments with Jio so far in 2020. By all accounts, the internet transformation unleashed by Jio is just beginning. Internet access in India will continue to expand at a very high rate over the years to come.

– Jack McMahon
Photo: Flickr