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GCash

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GCash
Product typeMobile Payments
OwnerGlobe Fintech Innovations Inc. (doing business as Mynt)
CountryPhilippines
IntroducedOctober 2004; 20 years ago (October 2004)
MarketsPhilippines
Websitewww.gcash.com Edit this at Wikidata

GCash is a Philippine mobile payments service owned by Globe Fintech Innovations, Inc. (doing business as Mynt), and operated by its wholly-owned subsidiary, G-Xchange, Inc.[1]

Mynt is a joint venture between Ant Group, an affiliate company of the Alibaba Group who operates Alipay, the world's leading mobile and online payments platform; Ayala Corporation, one of the Philippines' largest and oldest business conglomerates; and telco giant Globe Telecom, through its corporate venture builder, 917Ventures.

As of May 2023, GCash claims to have 81 million active users and 2.5 million sellers and merchants across the Philippines.[2][3]

Since GCash does not have bank status, the ₱500,000 protection of funds deposited in a bank by the Philippine Deposit Insurance Corporation is not available for e-money issuers.

History

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A GCash cash-in kiosk

GCash was launched in October 2004 as an SMS-based money to transfer service. It was Globe Telecom's answer to Smart Communications' Smart Padala which aimed to serve the majority of Filipinos who lacked access to formal banking services at the time. Users could convert their cash to e-money through cash-in and cash-out outlets like sari-sari stores with a transaction fee of ₱1.00.[4][5]

GCash launched its mobile application in 2012 to shift from physical outlets to a digital cashless system.[6] In 2017, GCash and its rival mobile wallet PayMaya, partnered with Facebook to offer its services within Facebook Messenger, but this partnership wouldn't last due to changes in Facebook's fintech strategy.[7] GCash is still widely used payment method for physical outlet and offline-related services in the Philippines, particularly retail and events.[8] As of 2022, there were an estimated 58 million active e-wallet users in the Philippines.

From 2013 to 2020, GCash focused on bringing new features to its app including QR-based payments, mobile and gaming credit purchases, online checkout, barcode cash-in, bills payment, and the support for InstaPay which enabled interbank transfers. GCash also partnered with CIMB Bank Philippines for the pilot of GSave, a high-yield savings account. GSave would later evolve into GSave Marketplace with options between CIMB Bank Philippines, BPI, and Maybank Philippines.[citation needed]

In 2021, GCredit, a revolving mobile credit line initially powered by Fuse Lending was also transferred to CIMB Bank.[9] GCash also revived its remittance service, now called GCash Padala, and made it available to non-app users through its 2,000 partner outlets nationwide.[10][11]

GCash's parent company, Mynt, made history as the Philippine's first double unicorn when it announced that it raised $300M in funding last November 2021 at a $2B valuation.[12][13][14] In an effort to further increase its footprint, GCash Jr., designed for users aged 7 to 17, was launched in 2022.[15]

In August 2024, GCash secured additional funding from Ayala Corporation and Mitsubishi UFJ Financial Group, increasing its valuation to $5B.[16]

Issues

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A QR Ph GCash QR code for in-store payments via the GCash app as well as QR Ph- and Alipay-affiliated mobile wallets

Service interruptions

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During its surge of popularity from 2017 to 2020, GCash experienced multiple service interruptions lasting between one and eight hours.[17]

Some users also complained that their concerns were not sufficiently resolved by customer support, thus giving rise to Facebook and Viber groups which served as a platform for customers to help and ask for help from other users. An episode of the segment "Tapat Na Po" from TV Patrol Weekend also tackled complaints about GCash arbitrarily blocking account access for some people.[citation needed]

There have also been reports of fraud and scams that specifically targeted GCash users, most notably involving phishing activities. In response, GCash launched "Double Safe" in 2023 which requires facial identification from customers.[18]

2023 unauthorized transactions

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GCash's most notable incident was on May 8, 2023, when hundreds of users, including notable personalities such as comedian Chad Kinis and Laban TNVS President Jun De Leon, reported missing funds from unauthorized bank transfers.[19][20] By midnight of May 9, the GCash app had shut down and a full-banner error message that read "We're just working on improving your experience. Rest assured that your funds are safe" was displayed.[21]

Around 300 victims formed a group chat and alleged hacking, but GCash denied that such an incident occurred and stuck to the same messaging that all funds were secure, even after its own admission that sums of money were funneled by an undisclosed malicious actor to two accounts in EastWest Bank and Asia United Bank without customer permission.[22] In a statement, GCash wrote:

Some customers may have experienced a deduction in their GCash accounts. We extended our scheduled maintenance to investigate and determined that no hacking occurred.

As of 4:00 pm PHT of May 9, GCash said it has already adjusted the balance of affected users, and added that the app is operational again after an hours-long downtime.[23] Users and government regulators remained unhappy without the public disclosure of a comprehensive investigation's findings. House Deputy Minority Leader Bernadette Herrera-Dy of Bagong Henerasyon filed House Resolution No. 963 which seeks for a congress-led probe because she was not satisfied with GCash's non-explanation of what caused the anomalous transactions.[24]

The Cybercrime Investigation and Coordinating Center, an attached agency of the Department of Information and Communication Technology, probed the incident and requested a meeting with executives from the mobile wallet's operator.[25] The National Privacy Commission mentioned that they, too, will be conducting an independent assessment to determine a potential data breach that may have resulted to unauthorized fund transfers.[26]

On May 24, 2023, the National Privacy Commission concluded its extensive investigation into the reported unauthorized transactions involving multiple GCash accounts. After careful examination and independent verification of the incident, the NPC confirmed that the security breach resulted from the utilization of phishing attacks. According to the Privacy Commissioner, John Henry Du Naga, "Unknown threat actors took advantage of vulnerable GCash users, triggering the phishing scheme through online gambling websites such as 'Philwin' and 'tapwin1.com'".[27]

References

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  1. ^ "GXI, First Performance Global Partner to Launch Mobile App in PH for Greater User Security and Purchase Control". Globe Telecom. February 22, 2016. Retrieved May 13, 2023.
  2. ^ "GCash urged to explain glitch in order to regain public trust". ABS-CBN News. May 10, 2023. Retrieved May 10, 2023.
  3. ^ Mercurio, Richmond (August 19, 2021). "GCash monthly gross transactions hit P300 billion". The Philippine Star. Retrieved August 20, 2021.
  4. ^ Unsworth, Adam (July 17, 2010). "Case Study – GCash". Archived from the original on March 3, 2023.
  5. ^ Mobile Money in the Philippines: The Market, the Models and Regulation. GSMA.
  6. ^ "Coins.ph, GCash, GrabPay, PayMaya: Who's leading the mobile payments war in PH?". Rappler. April 2, 2019.
  7. ^ "GCash, PayMaya take in Facebook Messenger for money transactions". GMA News. September 22, 2017.
  8. ^ "Selling event tickets with GCash, MAYA, GrabPay, and ShopeePay now supported in the Philippines". Selling event tickets with GCash, MAYA, GrabPay, and ShopeePay now supported in the Philippines | Eventsize. Retrieved August 21, 2023.
  9. ^ "CIMB Bank to power GCredit; customers to enjoy higher credit limits and lower interest rates". www.cimbbank.com.ph. Retrieved May 10, 2023.
  10. ^ Balinbin, Arjay (July 26, 2021). "GCash expands money transfer service to non-app users". BusinessWorld. Retrieved August 2, 2021.
  11. ^ Medilo, Luis Reginaldo (July 30, 2021). "How to Send Money to Non-GCash Users with GCash Padala". Tech Pilipinas. Retrieved August 2, 2021.
  12. ^ Abadilla, Emmie (November 2, 2021). "Mynt, PH's only unicorn gets $300-M funding". Manila Bulletin. Retrieved December 5, 2021.
  13. ^ "Mynt becomes first fintech Unicorn in the Philippines with $300 million fund raise". Finextra. November 5, 2021. Retrieved December 5, 2021.
  14. ^ Dumlao-Abadilla, Doris (November 2, 2021). "Mynt, fintech firm behind GCash, reaches 'double unicorn' status". INQUIRER.net. Retrieved January 31, 2022.
  15. ^ MB Technews (August 10, 2022). "Be ready to discover bigger things with your first e-wallet, GCash Jr". Manila Bulletin. Retrieved August 17, 2022.
  16. ^ Piad, Tyrone Jasper (August 2, 2024). "GCash boosts valuation to $5B with new funding from Ayala, MUFG". Inquirer.net. Retrieved August 12, 2024.
  17. ^ "Cash says app's services are restored after 4-hour outage". ABS-CBN News. January 11, 2022. Retrieved January 11, 2022.
  18. ^ "GCash to roll out 'double authentication' feature". GMA News Online. November 24, 2022. Retrieved November 24, 2022.
  19. ^ Cabristante, Raffy; Ambrosio, Zyann; Vicencio, Lady (May 9, 2023). "GCash says 'no funds lost' despite system glitch". ABS-CBN News. Retrieved May 10, 2023.
  20. ^ "Chad Kinis laments alleged 'hacking' of digital wallet: 'Inubos ang pera ko!'". Manila Bulletin. Retrieved May 10, 2023.
  21. ^ wsabalo (May 9, 2023). "GCash explains temporary downtime". Cebu Daily News. Retrieved October 5, 2024.
  22. ^ "Ilang bangko tumutulong sa imbestigasyon sa aberya sa GCash". ABS-CBN News. May 9, 2023. Retrieved May 10, 2023.
  23. ^ "GCash says all affected e-wallets 'adjusted' as of 4 p.m." ABS-CBN News. May 9, 2023. Retrieved May 10, 2023.
  24. ^ "House probe into unauthorized GCash transactions sought". RAPPLER. May 10, 2023. Retrieved May 10, 2023.
  25. ^ "Regulators probe GCash; telcos vow to strengthen data prote". Malaya Business Insights. May 12, 2023. Retrieved May 12, 2023.
  26. ^ "NPC probes 'potential data breach' in unauthorized GCash fund transfers". RAPPLER. May 13, 2023. Retrieved May 13, 2023.
  27. ^ "NPC Concludes Investigation on Unauthorized Gcash Transactions". National Privacy Commission. May 24, 2023. Retrieved July 6, 2023.
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