TransUnion’s Consumer Pulse Study for the third quarter of 2022 (Q3 2022) shows how Filipinos are responding to inflation and possible global recession. From the 1,013 Filipino adults surved from Aug. 19 to Sept. 1, 66% said they are building up savings in anticipation of the worst times.
According to the Philippine Statistics Authority (PSA), inflation increased to 6.9% in September, up from 6.3% in August, as food and energy costs continue to increase. The hike may push the central bank to further increase rates and borrowing costs for businesses and consumers.
About 76% of Filipinos are aware that the economy is either already in a recession or will enter one by the end of 2023. What worries almost 44% of respondents are the effects of inflation in basic household necessities.
When it comes to future spending, the respondents said that their greatest spending increases in the next three months are likely to be on bills and loans, medical care/services, and retirement funds and investing. They said they are least likely to spend more on large purchases like cars or appliances.
Additionally, 47% of respondents who said they won’t be able to pay at least one of their current bills and loans in full said that they will pay a partial amount for these.
However, credit remains an option for Filipinos to face the economic and financial uncertainties. The TransUnion report shows 56% of the respondents said they were planning to apply for new credit or refinance existing credit within the next year. More than half (54%) of Filipinos who said they plan to apply for new credit within the next year said that they would apply for a new personal loan, while 41% said that they’ll apply for a new credit card.
“As more Filipinos’ financial literacy improves, TransUnion is optimistic that more people will have the knowledge and tools they need to make responsible financial decisions, particularly at a time when economic indicators reveal a stressed environment,” said Pia Arellano, president and CEO of TransUnion Philippines. “Filipinos are highly adaptable, but it takes a community, including the corporate and banking sectors, to come together to achieve greater financial inclusion and economic recovery and growth.”