The Market Monitor Minding the Nation's Business
Formal credit options have been more accessible for eight out of 10 Filipinos in 2023, according to a new survey commissioned by consumer finance company Digido.
Of the 80%, 42% say there are no changes to the degree of accessibility and claim to be usually approved when applying for formal credit, while the remaining 38% say their access to formal credit has improved in 2023 compared to 2022.
The survey indicates Filipinos’ lingering behavior of borrowing from both formal and informal sources.
At the time of inquiry, 57% of respondents had at least one outstanding loan from a formal lender, with non-bank financial institutions (NBFIs) with an online component making up 31%, followed by traditional banks’ branches (25%), digital banks (14%), offline NBFIs (13%) and apps or websites of traditional banks (9%). 48%, meanwhile, borrow from friends or family members.
Respondents cite the easy application process (60%), convenient repayment methods (50%) and high probability of approval (47%) as the key factors that have influenced their decision in applying for a formal credit source in 2023.
Other positive factors include convenient repayment schedule (43%), application through mobile app (42%) and attractive interest rate (30%). Preferences are similar among all income groups and regions.