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  • Writer's pictureZiggurat Realestatecorp

Pinoys prioritizing financial resilience

Filipinos have become more cautious given challenging economic conditions, the local unit of an American consumer credit reporting firm said.

"Despite 80 percent of Filipinos expecting income growth in the next 12 months, 51 percent are saving more for emergency funds and 34 percent are paying debts faster in face of economic pressures," TransUnion Philippines said in a statement announcing the results of a fourth-quarter survey.

"This cautious attitude extends to how Filipinos are planning to calibrate their household budgets over the next three months," it added, noting that while 43 percent expect to spend more on bills and loans, and 35 percent see the same with regard to retail purchases, 48 percent, 44 percent and 21 percent, respectively, plan to cut spending on nonessentials, big-ticket items such as cars and even digital services.

"This nuanced approach to managing finances reflects a population that is navigating economic uncertainties with caution," TransUnion said.

Fewer Filipinos also see credit as a means of achieving financial goals with the number dropping 6 percentage points to 58 percent. Still, 63 percent of Generation Z consumers — those born from 1995 to 2004 — believe that access to credit is important.

The perception of having enough access to financial products also declined with only 40 percent of the respondents saying so, down from 45 percent a year earlier. Confidence was even lower among the Gen Z at 37 percent.

More than half — 59 percent — of those looking to secure new credit or refinancing ultimately decided against it, TransUnion said. High borrowing costs was the main reason cited (39 percent), followed by alternative funding sources (32 percent) and income or employment status (29 percent).

"These challenges reveal opportunities for lenders to further enhance financial inclusion," the credit reporting firm added.

The poll also found a dip in the importance of credit monitoring, with respondents who deemed the practice to be particularly crucial dropping to 35 percent from 44 percent a year earlier. Daily checks also fell to 35 percent from 44 percent, and 20 percent still do not monitor their credit reports — up from 18 percent in the fourth quarter of last year.

TransUnion Philippines President and Chief Executive Officer Pia Arellano

"[T]hese findings indicate a need to intensify consumer education efforts across the financial system about how access to credit information can affect or benefit an individual's financial health and enable them to make more informed financial decisions," TransUnion Philippines President and Chief Executive Officer Pia Arellano said.

Digital fraud, meanwhile, remains a major concern with 64 percent of those polled saying they were targeted but did not fall for the scams, while 8.0 percent said they were victimized.

Half of the respondents said they were hit by phishing attacks via email, websites and social media, and 43 percent said they were targeted via smishing or fraudulent text messages. Voice call scams (vishing) and third-party seller scams on legitimate online real platforms were also reported.

"The prevalence of digital fraud is a possible reason that 90 percent of survey respondents express concern over sharing their personal information," TransUnion noted. "This heightened vigilance reflects an increasing societal awareness of the risks associated with the digital world."

Better safeguards are needed, it added, pointing to reports that over P155 million had been lost from January to August this year due to online scams.

The TransUnion study involved 907 adult Filipinos who were polled from September 27 to October 10. The quarterly survey examines changes to consumer attitudes and behaviors among the Gen Z, millennials (those born from 1980 to 1994), Gen X (1965-1979) and baby boomers (1944-1964).

Source: Manila Times

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