The Philippines has witnessed remarkable growth in its digital economy in recent years. According to the Bangko Sentral ng Pilipinas (BSP), digital payments in the country grew from 10% of total retail payments in 2018 to 30.3% by 2021. The BSP aims to digitize 50% of retail payment transactions and bring 70% of Filipino adults into the formal financial system by 2023.
Financial inclusion efforts have shown promising results. As of 2021, approximately 56% of Filipino adults had formal financial accounts, a significant increase from 29% in 2019, driven largely by the pandemic's acceleration of digital adoption. Mobile wallet accounts have grown exponentially, with e-money accounts reaching 33.3 million in 2021, representing a 22% year-on-year increase.
As the Philippines experiences rapid digital adoption, it’s facing a parallel rise in financial fraud. In fact, identity-related fraud has surged by 121% in 2024, with 8.3% of all digital transactions in 2023 flagged as fraudulent (Asian Banking & Finance, Feb 2025). From investment scams and phishing to account takeovers and synthetic identity theft, the threat landscape is evolving fast.
In this increasingly hostile digital environment, identity verification is more than important. It’s a frontline defense for safeguarding customers, securing platforms, and expanding financial inclusion in the Philippines.
As the country goes digital, fraudsters are also getting smarter. Here are some of the most common types of financial scams happening in the Philippines:
These scams promise big returns, but they’re fake. Early investors get paid using money from new ones. The Aman Futures case is a well-known example that fooled thousands of Filipinos.
Fraudsters use the internet to trick people into giving away sensitive information. There are three types of this scam: Phishing, vishing, and smishing.
Criminals steal your personal info (like name, birthdate, or ID numbers) to make illegal purchases or open accounts under your name.
You’re promised a loan, prize, or job. But first, you’re asked to pay a “processing fee.” Once you pay, the scammer disappears.
Hackers break into online bank accounts, often using stolen credentials from phishing or malware.
Scammers place hidden devices on ATMs or card readers to steal your credit or debit card info.
These scams rely on emotional manipulation. In budol-budol, victims are shown fake money to gain trust. In dugo-dugo, someone fakes an emergency (like a family member in danger) to get you to send money quickly.
Strong identity verification acts as the first line of defense against all these threats. It helps platforms ensure that every user is real, legitimate, and accountable. More than just a security step, identity verification is crucial to enabling trust in digital services.
When done right, identity verification does more than block fraud, it also helps unlock access.
Millions of Filipinos remain unbanked, not because they don’t want financial services, but because they lack formal IDs or access to secure authentication methods. This is where digital identity can make a difference.
With tools like PhilSys and advanced digital ID systems, financial platforms can:
By securing access without adding friction, identity verification helps close the financial inclusion gap.
To combat rising fraud, Philippine lawmakers and regulators are also stepping in.
As fraudsters embrace AI and deepfake technology, traditional security isn’t enough. That’s where VIDA comes in offering multi-layered, AI-powered solutions. Here are products and services:
As the Philippines moves forward in its digital journey, we’re seeing incredible opportunities. Faster access to services, more inclusive financial systems, and a growing digital economy. But with that progress comes risk. Fraud and identity abuse are rising, and if left unchecked, they can undermine trust in digital services.
With stronger regulations, national identity initiatives like PhilSys, and secure solutions from trusted providers like VIDA, businesses now have the right tools to keep fraud out while letting real people in.