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Business

Gen Zs need better access to financing, survey shows

Louella Desiderio - The Philippine Star

MANILA, Philippines — Gen Z consumers, which are becoming an important driver of economic growth, need greater access to financing, according to global information and insights company TransUnion Philippines.

Research conducted by TransUnion in February this year showed that while most or 94 percent of Gen Z Filipinos believe that access to credit and lending products is important to achieve financial goals, only 35 percent of them have sufficient access.

TransUnion said Gen Zs or those born between 1995 and 2004, are becoming an increasingly important economic growth driver.

According to TransUnion, half of Gen Z consumers intend to apply for new or refinance existing credit in the next year through a new personal loan (47 percent), new mortgage, home loan or bond payment (37 percent), or a new credit card (35 percent).

TransUnion said this data showed an opportunity for credit providers.

“Access to credit is an important step in everyone’s financial journey. In the long-term, effective access to credit helps build loyalty, improve financial inclusion in the country and can act as a catalyst for economic growth,” TransUnion said.

In terms of where Gen Zs spent their money from November 2021 to February of this year, the same TransUnion study found that it went to adding or expanding digital services (35 percent), and adding to their subscriptions/memberships (24 percent).

In addition, 30 percent said they increased their spending on dining out, traveling or for entertainment, while 28 percent cut back on these expenditures.

When it comes to financial management, Gen Zs have prioritized paying off debts and increasing their savings with 56 percent opting to save more in their emergency fund, 30 percent paying their debts, and 28 percent allocating more funds for retirement.

To pay current bills and loans, 47 percent of Gen Zs said they would use their money from savings, and 33 percent said they planned to borrow money from friends or family.

While about half of Gen Zs expect they will not be able to pay some of their debts, they are trying to come up with ways to do so with 36 percent of them planing to at least pay partial amounts on their existing accounts, 13 percent to request for a payment holiday or other accommodation from lenders, and 10 percent to refinance or renegotiate payments/rates.

“The disaggregated data from our quarterly Consumer Pulse Survey allows us to gain valuable insight on the trends in saving, spending, and overall consumer habits of Filipino Gen Zs.

The information we gather can help different organizations and institutions better tailor-fit products and services for this very mobile and tech-savvy generation,” TransUnion Philippines president and CEO Pia Arellano said.

GEN Z

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