Eight in 10 Filipinos are optimistic about formal credit options

However, 42% said there were no changes in the accessibility of formal credit alternatives.

In 2023, 80% of Filipinos found formal credit options more accessible, with 42% noting no change and 38% reporting improved access compared to 2022. 

The survey by Digido revealed a persistent trend of borrowing from both formal and informal sources, with 57% having outstanding loans from formal lenders and 48% borrowing from friends or family.

Factors influencing formal credit applications in 2023 include easy application (60%), convenient repayment methods (50%), and high approval probability (47%). 

Personal loans were the most popular (54%), followed by 'Buy now, pay later' (12%), credit cards (6%), and business loans (6%).

Regarding payment habits, 64% claimed to always pay on time, while 36% admitted to missing repayments. 

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About 40% reported a decrease in the amount of loans taken in 2023, while 28% saw an increase. Additionally, 41% wished to raise their borrowing limit.

Despite room for improvement, nearly 8 out of 10 borrowers were satisfied with formal lending.

Looking ahead, 57% planned to take out a new loan in 2024, with 76% expressing satisfaction with their formal lending experience.

Online channels were preferred by 56% for obtaining formal credit, while 37% favoured offline channels. 

Improvement areas for formal credit institutions include loan rates (48%), repayment schedules (35%), and more repayment methods (33%).

The survey, based on 1,500 Filipino borrowers with diverse demographics, suggests high reliability and applicability to the Philippine population.