Filipinos are the most stressed about their current financial situation compared to other consumers in Asia-Pacific, data published this week in a Backbase commissioned study conducted by Forrester Consulting.
Not surprising as household debt in the Philippines is at a near-record of over P2 trillion, the report said.
The study said Filipinos also feel more anxious and uncertain, caused mainly by debt which was tagged by 70 percent of consumers as their top challenge when it comes to managing their finances.
The study showed 67 percent of banking customers in the Philippines said they feel overwhelmed by debt, 60 percent said debt negatively impacts their abilities to pay bills — this leads to more debt — and 63 percent said debt makes building savings difficult.
The findings highlight the need for banks to simplify financial wellness and provide personalized solutions to help to address debt .
“Digital financial wellness and money management tools, developed by banks as part of an accelerated transition to digital banking, will provide consumers with a range of new tools including spending analysis, scheduling of bill payments, automatic debt repayments, budgeting and more, delivered directly into their pocket via a smartphone app,” the report said.
Through advancements in digital technology, banks can now offer digital services to assist in managing debt correctly.
Digital banking has recently exploded in the Philippines with both digital banks and traditional banks racing to be the best when it comes to their offerings.
Unfortunately, according to the report, trust in digital banks is low with only 18 percent of respondents saying they trust a digital bank, compared to 60 percent for a traditional bank.
The research showed that in the Philippines 68 percent of people use their smartphone to bank with.
“By building out that interface and offering more tools, digital banks can address the trust issues, and traditional banks can compete in digital,”
said Riddhi Dutta. regional sales director for Asean and South Asia at Backbase.
