- Ziggurat Realestatecorp
- Jul 5
- 3 min read
Filipino consumers are cutting back on spending and bracing for higher expenses even as most remain optimistic about future income prospects, a TransUnion study showed.
TransUnion’s Consumer Pulse Study for the second quarter of 2025 showed that consumers were growing more cautious with their finances, with inflation continuing to top their concerns.
“Filipino households are approaching their finances with cautious optimism. While they’re aware of ongoing challenges like inflation and rising costs, many remain hopeful about their financial future,” said Weihan Sun, TransUnion’s research and consulting principal for Asia-Pacific.
“This mindset is reflected in their actions — cutting back on non-essential spending, saving consistently, and staying on top of debt,” Sun added.
While 73 percent of respondents said they expected their incomes to rise over the next 12 months, nearly half (44 percent) admitted they may be unable to fully pay at least one of their current bills or loans.
Inflation — cited by 83 percent of respondents — remained the biggest worry, followed by job security (59 percent) and interest rates (40 percent). The findings were said to have highlighted continued price pressures despite signs of improving income.
TransUnion said that almost half (47 percent) of Filipino consumers reduced discretionary spending on non-essentials such as dining out, travel and entertainment over the past three months.
A quarter also canceled or scaled back on digital subscriptions and services, while 45 percent boosted contributions to emergency savings and a third accelerated their debt payments — signs of a shift toward financial prudence.
Spending projections for the next three months suggest this trend will continue, with 42 percent planning to trim discretionary expenses further and 43 percent expected to delay or cut back on major purchases.
“These forecasts suggest even if most consumers were optimistic about their financial status, they were nevertheless cautious of economic headwinds (especially inflation) and were adjusting expenditures,” TransUnion said.
“The data indicates a financially active consumer base moving with the times to balance spending management with selective investment in their financial well-being,” it added.
While more Filipinos now believe they have sufficient access to credit — 44 percent from 38 percent a year ago — concerns about cost and rejection continue to discourage borrowing.
Over half (57 percent) of consumers who considered applying for new credit or refinancing existing loans ultimately abandoned their plans, mainly due to fears of being denied due to income or employment status (30 percent) or the high cost of borrowing (29 percent).
Even so, demand for credit remains steady. Among consumers intending to borrow in the next 12 months, Gen Z (58 percent) and Millennials (52 percent) led the charge, with personal loans, “buy now, pay later” options and new credit cards topping the list of preferred products.
“It is encouraging to see that more Filipinos now consider credit more accessible. However, the fact that over half of potential borrowers still walk away from their credit plans tells us there is still work to be done,” Sun said.
“Lenders have an opportunity to bridge this gap by offering more inclusive solutions — ones that not only meet practical needs but also build trust and address the emotional barriers that often come with borrowing.”
The report also showed persistent cybersecurity threats and gaps in digital financial literacy. A majority (56 percent) reported being targeted by online fraud schemes in the past three months, primarily via phishing (44 percent) and smishing or SMS scams (40 percent).
While most took protective steps such as changing passwords or checking account activity, 15 percent admitted to doing nothing — with over half citing confusion about what actions to take.
Meanwhile, only 27 percent of consumers check their credit reports monthly, and one in five do not monitor their credit at all. Although the majority (68 percent) still consider credit monitoring important, this marked a dip from 72 percent last year.
Source: Business World