Filipinos expect financial woes amid income growth

CEBU, Philippines — Despite optimism about income growth, nearly half of Filipino households expect rising bills and loan payments to create additional financial strain in the coming months, according to TransUnion’s fourth quarter 2024 Consumer Pulse Study.

The report revealed that 79 percent of Filipinos anticipate income growth over the next year, while 49 percent foresee an increase in financial obligations—up from 43 percent in the same period 2023.

These findings highlight the challenges Filipino households face in balancing income stability with escalating costs.

The study found that 84 percent of households reported either income growth (44 percent) or stability (40 percent) in the past three months, indicating steady financial trends.

However, over two in five Filipinos (42 percent) continue to struggle with paying bills and loans in full, a figure largely unchanged from fourth quarter 2023.

Inflation remains the top concern for 80 percent of consumers, followed by job security (59 percent) and rising interest rates (41 percent). These anxieties point to cautious spending and savings behaviors, with more Filipinos relying on credit to manage short-term needs.

“Faced with sustained financial pressure, many consumers are prioritizing immediate flexibility over long-term financial security,” said Weihan Sun, Principal of Research and Consulting for Asia Pacific at TransUnion.

“This trend raises potential default risks in certain debt categories, underscoring the importance of credit education,” Sun added.

Rising Interest in Credit Among Younger Filipinos

The study also highlighted a growing recognition of credit’s importance, particularly among younger generations.

Over 64 percent of Filipinos believe credit is essential for achieving financial goals, up from 58 percent last year.

Gen Z respondents led this trend, with 68 percent emphasizing the value of credit access.

However, only 42 percent of respondents felt adequately served by existing credit options, with 25 percent citing insufficient access.

According to the study, Gen Z consumers felt the most underserved (34 percent) but interest in new credit remains high, with 53 percent planning to apply for loans, credit cards, or buy-now-pay-later services within the next year.

More Filipinos are also proactively managing their credit health, with 71 percent checking their credit reports monthly—up from 67 percent last year.

However, 16 percent of consumers still do not monitor their credit at all, signaling an ongoing need for financial education.