Freeman Cebu Business

Credit card usage remains low in Philippines

Carlo S. Lorenciana - The Freeman

CEBU, Philippines — While banks keep on luring consumers to get a credit card, its penetration rate remains low.


Blame it on their strict requirements.

Cebu Bankers Club president Neil Darwin Credo attested it as among the factors that keep credit card usage among Filipinos very low.

“The low percentage of approval of credit cards in other banks due to strict requirements is one reason of low penetration,” the bank official told The FREEMAN in a phone interview.

Credit cards, he said, are also usually availed by the moneyed population.

“(Another factor is) that credit cards are mostly availed by the affluent and middle class because the rest are not eligible to get one,” said Credo, who works for Maybank in Cebu.

According to Credo, consumers now have a lot of options when getting a credit bank as some banks offer no annual fees.

“That’s an advantage to cardholders to switch to those banks offering free or no annual dues,” he noted.

As the bank sector eyes to increase the penetration rate, Credo believes the rise in e-commerce is another opportunity to make usage of credit card more relevant nowadays.

The rise of online shopping which is very popular nowadays especially in Cebu is another opportunity for banks to offer credit cards to Cebuanos but some opt for COD (cash on delivery),” he explained.

He added the digitalization of banking services is also likely to influence credit card usage.

“The digitalization of banking services and products or the so-called online banking becomes popular nowadays since it becomes an alternative way of paying online,” he said.

With credit card penetration estimated at below 10 percent, online retailers are offering more payment schemes such as cash on delivery.

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