Fintech PayMongo Weans Philippines Shops Off Cash By Simplifying Digital Payments
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Armed with fresh funding, payments fintech PayMongo is enabling small businesses in the Philippines to join the digital economy.


A three-year-old Philippine fintech firm is helping digitalize the country’s predominantly cash-based economy, one click at a time. Founded in 2019, Manila-based PayMongo has seen its user base and transaction volumes soar as it taps into the country’s vast pool of tiny merchants—from mom-and-pop shops to independent fashion boutiques—that relied on in-person cash dealings before the pandemic.

Backed by investors including PayPal cofounder Peter Thiel and payments giant Stripe, PayMongo enables sellers to send payment links to customers, who can pay using a range of options including credit cards and e-wallets. It’s a “Stripe for the Philippines,” says CEO and cofounder Francis Plaza. An honoree of the inaugural Forbes Asia 100 to Watch last year, PayMongo targets small- and medium-sized companies, which along with micro businesses, account for 99.5% of businesses in the Philippines but remain underserved by traditional payment providers. “Our biggest competitor is traditional payments, like cash,” Plaza says in a video interview in March from Madrid, where he celebrated his 28th birthday.

In February, PayMongo raised $31 million in a series B round, bringing its total funding to about $46 million. Founded in March 2019, it joined Y Combinator’s summer cohort later that year, becoming the first Philippine fintech to be selected by the U.S.-based startup accelerator. Upon graduation it obtained $2.7 million in seed funding from San Francisco-based Global Founders Capital, Tinder cofounder Justin Mateen and Stripe. PayMongo then raised $12 million in a series A round led by Stripe in 2020, after which the company said it tripled its merchant base to over 10,000 businesses and quadrupled monthly transaction volumes. Plaza declined to disclose these figures.

“Our biggest competitor is traditional payments, like cash.”

Plaza, who is eyeing expansion beyond the Philippine archipelago, credits each funding round with “changing the narrative of the company” by helping it to roll out products for e-commerce platforms, such as Shopify and WooCommerce, and mobile apps.

“From the start, the biggest misconception we had to actively educate outside investors about was the reality of the Philippine market,” says Plaza, a Forbes 30 Under 30 Asia honoree from 2020. “Not too long ago, they saw the Philippines as a small market,” he recalls, adding that “they’re now the ones saying we should double down in the Philippines.” The country was Southeast Asia’s fastest-growing digital market in 2021, according to a report by Google, Temasek and Bain & Co. It forecasts the Philippine internet economy to more than double to $40 billion by 2025 from $17 billion in 2021.

Some of this growth will likely come from increased financial inclusion in a country where about half the population remains unbanked. The government estimates that while only half of Filipino adults had a bank account as of 2021, the group almost doubled in size from 27% in 2020. The country’s latest national strategy for financial inclusion aims to introduce digital payments for all communities by 2023. “We need more people who are using digital tools in order to expand the economy further,” says Plaza.

He views the prospect of more people joining the digital economy as a win-win for Philippine fintechs, which are forming a “complementary ecosystem.” To achieve its goal of becoming an industry leader, PayMongo is collaborating with other fintechs including established e-wallets GCash and Maya to make online payments more convenient. Prioritizing partnership over competition makes sense for PayMongo, says Sachin Mittal, who heads telecom, media and technology research at DBS Bank in Singapore. “It’s important that you collaborate with a market leader that will promote your solution,” says Mittal, referring to GCash, the Philippines’ largest e-wallet with 51 million users as of October 2021.

“We had thousands of businesses asking for the solution overnight.”

A digital payments platform isn’t what Plaza and fellow PayMongo cofounders—including chief technology officer Jamie Hing III, chief operating officer Edwin Lacierda and former chief growth officer Luis Sia—initially had in mind. A computer science graduate from MIT, Plaza met Sia in college through their involvement with computer science clubs. Plaza subsequently worked with Hing to develop software at local logistics firm QuadX. He and Lacierda—previously a spokesperson for late Philippine President Benigno Aquino III—joined forces in 2016 to build an analytics platform for voting behavior.

Plaza says PayMongo was initially a “side project” of a short-lived software consultancy he founded in 2018 called 22 Delta Labs. He realized integrating payments was among the hardest tasks for micro, small and medium-sized enterprises as they had to rely on outsourced software. “We had thousands of businesses asking for the solution overnight,” says Plaza. “We realized, why don’t we actually just focus on payments?”

PayMongo now not only plans to expand beyond the Philippines to other Southeast Asian countries, but also to broaden its remit by becoming a platform for scaling small businesses in the region. By year end, it plans to boost its employee strength to 300 from 200 while expanding the suite of services it offers sellers. Last August, PayMongo launched an accelerator program to help small entrepreneurs with a two-month transaction fee waiver across all PayMongo’s payment channels and free webinars on business, finance and technology. The company believes future initiatives may build off such programs.

Having benefited from Y Combinator’s accelerator program and the knowledge gained from investors and partners, Plaza says PayMongo wants to do the same for other small businesses looking to grow. Besides providing “financial infrastructure for everyone,” he says the true measure of PayMongo’s success will lie in its ability to enable its employees to start their own companies. “When people who’ve actually helped us build this look back and say that their time in PayMongo has been instrumental in helping them succeed in their new venture, it’s really this flywheel of more startup firepower, which eventually will grow the [Philippine] economy,” he says.

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