Can you believe that we are almost halfway through the year 2020? To some, the quarantine lockdown period felt like eons and yet, here we are seeing the light at the end of the tunnel as governments across the globe are taking careful steps in re-opening their economy.
The global economy has seen regression and depression during the lockdown periods of early February to the current month of May. Despite that, the digital economy has been resilient, if not thriving more than ever. In the Philippines, digital banking has seen bumper growth amidst the lockdown as Filipinos signed up and transacted with digital banking services that lead to record numbers for the digital banking platforms of local banks. Elsewhere, videogame spending and video on demand services such as Netflix saw a strong surge in their quarterly earnings as people used digital multimedia to pass the time during their quarantine confinement.
As things are set for a careful stride to normalcy, the coronavirus pandemic has left a lasting effect on our economy, businesses and how consumers will behave moving forward. Much like the digital entertainment scene, businesses and government services will be getting more in touch with the digital side of services as the “Less Touch Economy” will be the new normal for not only the remainder of 2020 but for also the foreseeable future.
As fiat and material currencies were instrumental in the spread of the infection, people have turned to digital wallets powered by payment processors to do the most basic of transactions. Whether it was for buying supplies or paying upfront for delivery, digital wallets have proven to be an effective alternative to fiat payments this year. With less touch and through secured payment processes via encryption or through QR code technology, cashless payments were increasingly being used by wary consumers as the latter has proven to be not only convenient, but also helped people avoid possible surface or material contact that may incur infection.
Digital wallets have also proven to be versatile as well as more value derived as discovered by even first time users. Some wallets and their merchant tie-ups have discount incentives when you use services such as PayMaya or Paypal. These added value include discounts, patronage points and freebies. Much like the traditional cash-based wallet which is your doorway to shopping, digital wallets can be used offline and online for e-commerce. From streaming music to buying the latest videogames to online shopping, digital wallets are recognized in all fronts. This near universal compatibility has been a gateway for not only entertainment but also for procurement of essential supplies by organizations.
Mobility of Mobile Transactions
The early 2000s was the first gold rush age for online shopping. In the 2010s, the mobile shopping gold rush began and it will only thrive as an economy in the years to follow. Mobile transactions has been a staple of the modern lifestyle as the mobile phones evolved to become smartphones. Today, applications such as banking, shopping, financial services and remittances are accessible through the common smartphone. Add digital wallets as applications, the mobile phone becomes a value stored digital wallein itself as it hosts not only credit value, but also value added services.
During the lockdown, businesses that were considered essential either ramped up their online storefront to accommodate an increasingly mobile-first consumer behaviour for in-store pickups, curbside pickups and delivery courtesy services. After the lockdown, expect mobile-first service extensions to be very common as restaurants, shops and other service providers are now using online or digital portals for transactions. Mobile first and online reservations are not only convenient but are also minimalizing the exposure of queuing, person to person contact over the counter and avoiding surface contact. For the customer, these kind of services are value-added that focuses on personal safety and convenience.
Digitalization of Business Infrastructure
Forecasts have suggested that economic recovery will be modest in the months to follow post pandemic. But during the recovery period, businesses and government services will shore up their digital infrastructure in order to not only comply with mandates of embracing e-services and online services, but also as a safety precaution of hosting less and less physical queuing. With the task of digitalization, service providers such as systems development, website builders and specialized digital services will experience a bump up in their activities and dividend growth. For once, from on-premise traffic will be converted to on-site traffic over the website portal. From what once was pen and paper signups can make way for online signups as government offices will be able to streamline their processing capabilities by doing away with the encoding or transcribing of raw information extracted from paper. Instead, online fillable forms can be ported to a database, thus doing away with the redundancy of encoding.
On-site phone operators will also experience more flexible and accommodating measures as in-house phone centres will move in favour of the flexibility brought by the interim Voice over the Internet Protocol (VOIP). From digital trunks, switching technology in the form of IPBX telephony services will allow on-site phone operators to login remotely and be able to still answer phones in locations such as their homes or from a satellite office.
As consumers will lean more to the digital transaction side of things, the cause and effect will be felt by businesses, as they too, will be increasing or ramping up their digital capabilities. For business continuity, digitalization will allow more flexible working arrangements for employees and the business transaction process. As workers are able to work and collaborate remotely, local agencies can also maintain their operating capacity to service customers on the digital side while enabling robustness of the core business practice in the administration side. As Metro Manila moves away from Enhanced Community Quarantine to a Modified General Community Quarantine where the local government have strongly advised on workplace safety through work from home arrangements, the administrative side of the business must be flexible enough to accommodate this paradigm shift in the workplace. There should be clear definitions on working from home arrangements and being able to still communicate effectively with the other operators in the business chain.
Shoring up digital infrastructure to enable more digital transactions will open up remote or hybrid working arrangements. It will strengthen business contingency plans on business continuity during pandemics as global mindsets now have future pandemics breakouts in mind as they formulate their contingencies. Overall, our lifestyles will change whether it will be work, play and family time in the near future.
This article is published on BitPinas: [DynaQuest] The Less Touch Economy Post Coronavirus Lockdown