Offshore Software Development Philippines: What You Need to Know

March 20, 2024

Offshore Software Development Philippines What You Need to Know

In the realm of outsourcing, the Philippines has been a longstanding player. It’s always up there as one of the top choices for offshore software development destinations.

But what exactly makes the Philippines a go-to destination for offshore software development? And what should you know before considering this option for your business?

In this article, we’ll dive deep into the world of offshore software development in the Philippines and everything you need to know about it.

So let’s get started!

The Outsourcing Industry in the Philippines

Back in 1995, a game-changing move was made by the Philippine Congress with the passage of the Special Economic Zone Act. This pivotal legislation gave birth to the Philippine Economic Zone Authority, setting the stage for tax incentives and relaxed development area requirements that caught the eye of international investors.

This marked a turning point for the country’s economy, giving rise to the now-booming outsourcing industry.

In 2001, President Gloria Macapagal Arroyo spoke at an IT forum in the U.S. At this event, several U.S. and Philippine companies signed three MOUs, sparking the growth of the BPO industry in the Philippines.

It was just a matter of time before the country was brimming with software development companies that cater to the global market.

Benefits of Hiring a Software Development Company in the Philippines

Hiring professional software developers from the Philippines brings with it a whole range of benefits.

Below are just some of the reasons why many businesses choose to outsource their software development needs to the Philippines:

Software engineering flourishes in the Philippines

In the 2018-2019 school year, about 81,000 students graduated in Information Technology (IT) fields. This number is likely to keep growing as more students get into IT

Some years ago, there were worries about having too many software developers in their local market. Cebu and Manila are particularly known for their vast talent pools.

So, if you search for software companies in the Philippines, you will get many options to choose from. And as competition amongst these companies increases, there is a natural drive towards continuous improvement and excellence.

Startechup Custom Software Services

StarTechUP is a custom software development company based in Cebu, Philippines. Our team of experts has worked with clients from all over the world, providing high-quality and efficient software solutions.

Check out our services here!

Political and economic ease

Clients worldwide are attracted to the Philippines because of its political stability. Unlike some other Asian countries, the Philippines is not plagued by civil unrest.

Central and western Asia can get a bit shaky politically now and then. This can really throw a wrench in the works for big and small businesses outsourcing to these areas.

Moreover, China’s stance towards the United States is becoming more confrontational, and safeguarding intellectual property is no walk in the park.

The Philippines, as a third-world country, boasts of a lower standard of living. The cost of labor is cheaper here than in most developed countries. So, it’s a win-win situation for both the businesses and workers.

Culture compatible with Western countries

The Philippines has been a U.S. colony for nearly 50 years. This, alongside the country being a Spanish colony for roughly 250 years, left a significant mark on the culture. As such, clients find working with Filipino developers easy and comfortable.

Filipinos, in general, are known for their friendly and accommodating nature. For instance, an outsourcing company in the Philippines will typically assign a project manager who will act as a bridge between the client and the development team. This helps facilitate efficient communication and ensures that all parties involved are on the same page.

Some clients might grumble about having loads of holidays in the Philippines. Many businesses and schools shut down on national holidays like Christmas, New Year, and Easter.

Influenced by strong Catholic traditions, the country observes holidays that hold significant meaning in its Christian heritage. So this means that Filipino developers might not always be available for work during these holidays.

Fluency in English

The Philippines is known for its strong English skills. In fact, in EF’s English Proficiency Index for 2020, it’s ranked 20th out of 100 nations/regions, coming in second in Asia. This makes communication between clients and software developers much more efficient and seamless.

In Cebu, for instance, the second most spoken language is English, with most locals using it as their primary language in business and everyday conversations.

The driving force behind this is that numerous schools in the Philippines immerse students in English from early elementary years. With a significant portion of their economy revolving around business process outsourcing (BPO), English proficiency is deeply embedded in their educational framework.

So whether you hire a software developer or a team of developers, you can be assured that language will not be a barrier in conveying your requirements and ideas effectively.

[Also read: Outsource Software Development Projects: Philippines or India?]

Drawbacks of Hiring a Software Development Company in the Philippines

While there are many benefits to outsourcing your software development needs to the Philippines, it’s also essential to take note of the potential drawbacks.

If you’re thinking of getting mobile app development or any type of software development service from the Philippines, here are some potential challenges that you may encounter:

Time zone difference

One of the biggest challenges when working with any offshore team is managing the time zone differences. The Philippines is 12 to 15 hours ahead of North America and Europe, making real-time communication challenging.

This can lead to delays in project updates and feedback, which can potentially impact the overall project timeline.

However, most software development companies in the Philippines have adapted to this challenge. They often have flexible work schedules to accommodate clients from different time zones, and they use project management tools that allow for efficient communication and collaboration.

[Also read: Offshoring to Philippines vs. Australia: Which One is Better?]

Fewer chances for face-to-face catch-ups

Outsourcing staff augmentation services, for instance, can mean having a team of dedicated developers working exclusively on your project. However, since they are based in the Philippines, it may be challenging to have regular face-to-face catch-ups with them.

While video conferencing tools and other online communication platforms make it easier to stay connected, some clients may still prefer traditional in-person meetings for more efficient discussions and updates.

Expect language hiccups

While English is commonly used in the Philippines, there might still be some language barriers to think about. Accents, dialects, and cultural differences might sometimes make it a bit tough to communicate, causing mix-ups and delays.

It’s key to set up clear communication channels and offer language training when needed to make sure your tech team communicates effectively.

Factors to Consider When Choosing a Software Development Company in the Philippines

choose a company quote

While there are hundreds of software development companies in the Philippines, not all of them may be a good fit for your specific project needs.

Here are some factors to consider when choosing a software development company in the Philippines:

Industry expertise

Are you in need of mobile app development services to build a fintech app? Or do you require custom software development for your e-commerce business?

It’s crucial to choose a company that has a good understanding of your industry and can offer valuable insights and expertise to help you achieve your project goals.

Latest technologies and tools used

Artificial Intelligence (AI) development, blockchain technology, and the Internet of Things (IoT) are just a few of the latest trends in software development. If one of these technologies is crucial to your project, make sure the company you choose has experience and expertise in utilizing them.

Also, ask about their development process and the tools they use. Are they updated with the latest methodologies like Agile or Scrum? Aligning your project requirements with the company’s capabilities is crucial for a successful collaboration.

Reputation and reviews

Doing your research is key when choosing a software development company. Check out their website, portfolio, and online reviews from previous clients to get a better understanding of their capabilities, work ethics, and customer satisfaction.

Clutch, GoodFirms, and G2 are just a few of the platforms where you can find verified reviews and ratings from clients who have worked with software development companies in the Philippines.

Cost and budget

The best software development companies you can hire in the Philippines are known for their high-quality services at competitive rates. But hey, don’t hesitate to talk openly about your budget and chat about cost estimates upfront to steer clear of any confusion or surprise fees.

When you’re connecting with potential companies, request a breakdown of costs and ensure everyone’s on the same page before kicking off the project.

Top Software Development Companies in the Philippines

To get you started on your search for the best software development company in the Philippines, here’s a list of some top players in the industry:

1. StarTechUP Inc.

Working ten years in the industry, StarTechUP Inc. offers a wide range of custom software development services, including web and mobile app development, staff augmentation, and digital transformation.

We collaborated with clients from various industries, such as food and beverage, healthcare, and events. Our tailored solutions, combined with our Agile approach, have allowed us to deliver successful projects to clients worldwide.

Contact us to learn more about our services!

2. Arcanys

Arcanys is known for being a top-notch custom software development and team augmentation company in the Philippines. They excel in crafting tailored software solutions, blending tech know-how with a dedication to fulfilling clients’ specific needs.

Alongside their technical expertise in custom software development, Arcanys offers team augmentation services, helping businesses level up by bringing in skilled professionals to their teams.

3. Intechsive Software Development

As a strategic partner, Intechsive Software Development excels at catering to clients’ diverse needs with custom solutions that drive their business goals. Their commitment to excellence shines through as they navigate the ever-changing outsourcing and software development realm.

From streamlining outsourcing to crafting innovative web and mobile apps, Intechsive is devoted to delivering top-notch solutions that empower businesses to thrive in the digital age.


The Philippines is brimming with talented software developers and companies that offer top-notch services to businesses worldwide. As long as you are thorough with your research and consider the factors mentioned above, you can easily find a reliable software development company in the Philippines to help bring your project to life.

So, don’t hesitate to tap into the country’s growing tech scene and take advantage of its skilled workforce, competitive rates, and diverse expertise!

About the author: Andrea Jacinto - Content Writer

A content writer with a strong SEO background, Andrea has been working with digital marketers from different fields to create optimized articles which are informative, digestible, and fun to read. Now, she's writing for StarTechUP to deliver the latest developments in tech to readers around the world. View on Linkedin