How Technology Will Supercharge the Philippines’ MSMEs in 2026
February 15, 2026 — By Krishnaraj Tantri | The Manila Times
The small and medium enterprise (MSME) sector in the Philippines stands on the precipice of a technological revolution that promises to transform commerce and drive unprecedented growth. As digital adoption continues to accelerate, innovations in payments, artificial intelligence (AI), and embedded finance are reshaping how Filipino businesses operate and engage with consumers.
From the traditional sari-sari store embracing QR code payments to online sellers utilizing digital wallets, the Philippine market has long been characterized by creativity and adaptability. Now, as new technologies like ChatGPT and DeepSeek take the world by storm, MSMEs in the country must prepare for a future where payments and commerce are intelligent, seamless, and embedded into daily life.
Agentic Commerce and AI: A New Era for Payments
Artificial intelligence is set to revolutionize payments through agentic commerce, where digital assistants autonomously anticipate consumer needs and complete purchases without human intervention. Imagine a system that tracks household supplies, compares prices, leverages loyalty programs, and executes transactions instantly—with no action required from the buyer.
This shift redefines conventional notions of trust, consent, and identity management in payments. In the Philippines, where trust in digital services is critical, AI-driven commerce will thrive only if security and continuous authentication are prioritized to safeguard user data and preferences.
Payments as Continuous Engagement
The payment journey is rapidly evolving beyond checkout counters. Payments are becoming omnipresent touchpoints—across physical stores, social media, livestream sales, and delivery apps—capturing rich consumer insights and fostering personalized engagement in real time.
For Filipino MSMEs, integrating payments with inventory management, marketing, and loyalty programs opens opportunities to understand customers better and tailor experiences effectively. This fluid commerce environment transforms every interaction into a valuable engagement moment.
Embedded Finance Fuels MSME Growth
Embedded finance—offering financial services directly within existing platforms—is no longer a peripheral add-on but a vital growth driver for MSMEs. Flexible payment options like buy now, pay later (BNPL) solutions have shown global retailers revenue boosts of 25% or higher, and similar effects are observed in the Philippines, where consumers increasingly seek budget-friendly, digital payment alternatives.
Moreover, embedded finance enhances financial inclusion by allowing MSMEs to access working capital, credit, and loyalty tools without needing specialized expertise. For example, a neighborhood café can obtain equipment financing repaid automatically via daily sales, while online sellers can seamlessly incorporate subscriptions or installment plans into checkout processes. AI further accelerates this trend through real-time credit assessments and personalized financial offers.
Instant Payments: Meeting Customer Expectations
Speed is now a baseline expectation for payments in the Philippines. Instant payment capabilities enable real-time settlements for commerce, payroll, and business-to-business transactions. For MSMEs and gig economy workers whose operations depend heavily on swift cash flow, faster settlements enhance liquidity, reduce credit reliance, and facilitate reinvestment in growth.
Financial institutions and merchants must upgrade infrastructures to support around-the-clock payments with immediate reconciliation, ensuring consumers and businesses receive reliable, always-on service.
Stablecoins: The Practical Future of Crypto
While cryptocurrency has seen fluctuating adoption, stablecoins—digital tokens pegged to fiat currencies—are gaining practical traction due to their ability to offer speed, transparency, and programmability without extreme volatility. In the Philippines, stablecoins present promising applications for cross-border payments, remittances, and digital commerce.
Given that remittances from overseas Filipinos reached US$3 billion and account for 8.7% of the country’s GDP, stablecoins could significantly reduce transaction costs and settlement times. As regulations evolve, stablecoins are poised to become a central topic in the Philippines’ financial future.
Self-Service Payments Transform Customer Experience
Self-service payment options such as QR codes, kiosks, and in-app ordering are increasingly mainstream in Filipino malls, transportation hubs, food courts, and residential buildings. These technologies offer convenience for consumers and commercial benefits like increased order values and reduced losses.
For MSMEs, self-service systems help ease staffing challenges, shorten queues, and provide real-time transaction data, supporting better operational decisions with low overhead. However, ease of adoption and intuitive user experience remain key to widespread acceptance among both merchants and customers.
Looking Ahead: Payments as a Strategic Capability
The payment landscape in the Philippines underscores a dynamic transformation where payments are intelligent, embedded, and central to business strategy—not merely backend functions. Filipino MSMEs that embrace these technological trends stand to gain enhanced trust from consumers, broader financial inclusion, and accelerated growth.
In an increasingly competitive and interconnected economy, the MSMEs that proactively adapt to evolving payment innovations will best position themselves to meet rising consumer expectations and thrive in the marketplace of 2026 and beyond.
Krishnaraj Tantri is the senior vice president for South and Southeast Asia at Global Payments, a US-based fintech company specializing in payment processing solutions.
