e-Conomy SEA Report 2025: How Philippines’ Digital Economy Is Navigating Steady Growth

In our previous blog on the e-Conomy SEA 2025 Report, we explored Malaysia’s digital economy and how it scaled with strong sectoral growth, rising AI adoption, and a maturing digital finance ecosystem. While Malaysia showcased structured expansion, the Philippines presents a slightly different story– one of steady growth supported by strong domestic demand, remittances, and a rapidly evolving digital infrastructure.

So, without much further ado, let’s dive into some of the major highlights of the report.

1. Steady Double-Digit Growth in Digital Economy

The Philippines’ digital economy grew by 16% to reach $36B in 2025, up from $31B in 2024. This growth was driven by consistent double-digit expansion across key sectors, including e-commerce, online travel, transport and food, and online media.

E-commerce remained the largest contributor at $24B, while sectors like transport and food and online media also posted strong gains. Despite global uncertainties, strong domestic consumption has helped sustain the country’s digital momentum.

2. Digital Payments Surge, Fueling Financial Services Expansion

Digital payments in the Philippines have seen rapid growth, now accounting for 57% of total retail payment volume and 59% of value. Platforms like QR Ph, InstaPay, and PESONet have scaled significantly, reflecting growing consumer trust.

E-wallets are emerging as the primary entry point into financial services, expanding into lending, wealth management, and insurance. At the same time, the central bank’s move to grant new digital bank licences is expected to intensify competition and innovation in the sector.

3. Video Commerce Sees 90% Surge in Transactions

The Philippines’ video commerce ecosystem is expanding rapidly, with transaction volumes rising by 90% year-on-year. The number of sellers and stores also grew by 35%, highlighting increasing participation in the space.

Operating as a high-volume, low-cost market, the average order value in video commerce remains between $4.5 and $5.5. Categories such as fashion, beauty, and electronics continue to dominate, while top sellers account for a significant share of transactions.

4. Strong AI Engagement Despite Modest Funding

The Philippines recorded $30M in private funding in AI between H2 2024 and H1 2025, accounting for just 1% of total AI investments across ASEAN-10 countries. Despite relatively low funding, user engagement with AI remains strong.

About 77% of users have interacted with AI tools and features, while 56% actively engage with AI chatbots. Additionally, 43% of users expect AI to make decisions faster with less mental effort, indicating growing reliance on AI-driven solutions.

5. Domestic Tourism Rises as International Travel Lags

Domestic tourism in the Philippines continues to grow strongly, with air passenger numbers reaching record highs. This growth has been driven by targeted campaigns promoting local culture and destinations.

However, international tourism has lagged behind expectations due to visa restrictions and geopolitical challenges. While efforts are underway to attract more foreign visitors, domestic travel remains the primary driver of the country’s online travel growth.

Bottom Line

The Philippines’ performance in the e-Conomy SEA 2025 Report highlights a digital economy that is growing steadily while adapting to external uncertainties. Strong remittance inflows, rising digital payments, and a coordinated push on infrastructure and governance are creating a solid foundation for long-term growth.

At the same time, increasing engagement in AI and rapid expansion in video commerce signal the country’s readiness to embrace the next phase of digital innovation. While challenges in global trade and tourism persist, the Philippines appears well-positioned to sustain its digital momentum in the years ahead.

To delve deeper into the report, click here to read the full report. 

We’ll be back with more insightful blogs on the e-Conomy SEA 2025 Report. Till then, stay tuned!