The trust or faith Filipinos put in the credit products put out by the various financial institutions has increased significantly based on the latest credit perception index or CPI conducted by the private credit reference firm TransUnion.
According to Peter Faulhaver, TransUnion PH CEO, while most CPI factors as favorability, concept knowledge, reservations and stigmas remained, trust in credit products increased significantly by six points.
This developed even as the country’s CPI score stands lower this year to 73 out of 100, from last year’s 74, indicating stability in credit sentiment.
Nevertheless, the average Filipino’s receptivity to credit, or the likelihood of taking advantage of credit after knowing its potential benefits, has dropped by nine points.
“This decline may be attributed to external factors such as higher interest rates and growing concerns about fraud,” the executive said.
This reluctance to access credit were evident not only on the general population but also on the unbanked portion and the fintech or financial technology users.
CPI data showed that 59 percent, 52 percent and 61 percent, of the respondents cited high interest charges as deterrent to accessing available credit.
Concerns about scams and fraud followed closely, affecting 52 percent of the population, 47 percent of the unbanked and 52 percent of fintech users.
Security and trust emerged as key consumer considerations when choosing to engage with financial institutions, cited by more than half, or 58 percent of the population, and slightly behind convenience at 60 percent.
TransUnion executives said while trust is improving, consumers still require stronger assurances via safer and more supportive credit environments. Addressing these concerns is key to unlocking greater participation in the credit ecosystem and advancing financial inclusion across all segments of the population, the executives said.
