PH digital economy on track to hit USD 42 billion (around PHP 2.65 trillion) in 2026

The report projects the digital economy could reach as high as USD 157 billion by 2035, with AI use rising.

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Key findings from e-Conomy SEA

The Philippines' digital economy is on track to reach USD 42 billion or PHP 2.65 trillion in gross merchandise value (GMV) by the end of 2026.

According to the 11th annual e-Conomy SEA report by Google, Temasek, and Bain & Company, the figure is up 15 percent from USD 36 billion (PHP 2.27 trillion) in 2025.

The report, titled "Building the Intelligent Economy," projects that the figure could reach as high as USD 157 billion or PHP 9.90 trillion by 2035. It said the digital economy continues to accelerate, increasingly helped by AI adoption and usage.

Despite geopolitical and macroeconomic headwinds, the report sees an optimistic outlook for the long-term growth of AI and the digital industry. It cited policy support, including the 2026 launch of the National AI Center for Research and Innovation, new National Privacy Commission frameworks and the Internet Transactions Act, as well as changing Filipino user behavior.

E-commerce, online travel, and online media mainly drove the GMV growth. E-commerce grew 15 percent year-on-year to USD 28 billion or PHP 1.77 trillion in 2026. Online travel grew 14 percent to USD 3 billion or PHP 189.18 billion, versus 9 percent the previous year, and online media grew 26 percent to USD 6 billion or PHP 378.36 billion, versus 23 percent.

Mobility and food grew 2 percent year-on-year to USD 4 billion or PHP 252.24 billion. The report projects the segment to reach USD 7 billion or PHP 441.42 billion by 2030 and USD 11 billion or PHP 693.66 billion by 2035.

Digital payments grew 23 percent year-on-year in 2026 to USD 194 billion or PHP 12.23 trillion in gross transaction value, the fastest growth in Southeast Asia.

The report said this is supported by the scaling of the national digital ID, InstaPay for Business, and the merger of BancNet and the Philippine Clearing House Corporation to streamline payment interoperability.

Digital lending's loan book balance grew 17 percent to USD 7 billion or PHP 441.42 billion from USD 6 billion or PHP 378.36 billion in 2025, and is projected to reach USD 31 billion or PHP 1.95 trillion by 2035.

Digital insurance grew 16 percent to USD 110 million or PHP 6.94 billion in annual premium equivalent and gross written premiums, tying with Vietnam as the fastest-growing digital insurance sector in Southeast Asia.

This year's report introduced AI usage, measured in tokens, as the AI equivalent of GMV. It found that 53 percent of the working population actively uses standalone GenAI platforms, which it described as mass-market scale, with some of the region’s largest room for future user and enterprise growth.

About 42 million Filipinos use GenAI, generating 55 billion AI queries a year. Counting embedded AI, there are around 65 million monthly AI users. One in four AI users interacts with AI tools every day.

Also, one in two users trusts AI more than they did the previous year, and seven out of 10 are willing to delegate purchase decisions to AI.

The report also sees room to deepen use. Although 33 percent of consumer journeys begin with AI, Filipinos average around 1.87 AI sessions a week and 13 million consumer tokens per GenAI user.

Most Filipinos prefer to converse with AI in English, with local-language prompts making up 21 percent of conversations. Gemini prompts for customer support content in the Philippines are nearly three times the regional average.

The top five uses of AI are, in order, study, work, health, online shopping, and entertainment. Consumer applications account for around 80 percent of AI usage.

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