A growing number of Filipino borrowers are opting for repayment flexibility over default as economic pressures squeeze household budgets, according to digital bank Tonik.

The bank reported a threefold increase in the usage of its loan payment holiday feature, "Payhinga," since January 2025.

Activation of the feature rose from 10 percent to nearly 31 percent of eligible customers, peaking at nearly 34 percent during recent periods of heightened economic pressure.

Tonik executives said the surge underscores a growing demand for financial tools that help consumers manage temporary income shocks without damaging their long-term credit profiles.

Unlike traditional loan restructuring, which typically occurs after a borrower’s credit history has been impacted, Payhinga is an opt-in feature selected at the time of loan application.

It allows borrowers to temporarily pause repayments during unexpected financial challenges, helping them avoid missed payments and penalties.

The feature also includes Credit Life Insurance provided by Sun Life Grepa Financial Inc., which is available across Tonik's consumer lending portfolio.

"Financial inclusion doesn't end when a loan is approved," Mila Bedrenets, chief growth hacker at Tonik, said. "Real financial inclusion means helping customers successfully repay their loans even when life becomes difficult."

Tonik reported a 220 percent growth rate for the product over the past 17 months. Bank officials noted that actual usage accelerated as macroeconomic conditions worsened, indicating customers are using the feature for genuine financial hardships rather than as a routine repayment option.

The product is primarily designed for working Filipinos earning between P25,000 and P40,000 a month, many of whom serve as primary breadwinners. For these households, a temporary loss of income can quickly trigger loan defaults.

Bank officials said the strategy benefits both the consumer and the institution. Borrowers preserve their credit standing and access to formal financial services, while Tonik maintains its portfolio quality by preventing defaults.

The initiative aligns with Tonik's broader strategy focused on risk-managed lending, data-driven underwriting and customer-centric product design.

"Many digital lenders compete on how quickly they can approve loans," Bedrenets said. "We believe the bigger responsibility is helping customers successfully complete their financial journey."