A survey has revealed that online borrowing is gaining popularity in the country, specifically in highly urbanized areas of the National Capital Region (NCR) and the Cordillera Autonomous Region (CAR).
The urbanization and proximity to the technologically developed capital are enhancing demand for Fintech solutions among Filipinos
In its report, the financial holding company Robocash said its analysts mapped regional demand for online loans in the Philippines and they identified NCR as the clear leader by the number of requests for online financing.
Financial technology, or Fintech, is offered by companies that provide financial services through the use of software and other modern technology.
The report explained that although CAR is the country’s least populous region, it still managed to grab the second slot after NCR. This was primarily due to the huge interest in online financing facilities among customers based in Baguio City. This regional center cornered almost 100 percent of customers in the CAR.
The report observed a similar situation in Central Visayas, which cornered 6.7 percent of the pie with its regional center Cebu City accounting for 5.3 percent.
Likewise, the Davao region held 3.9 percent of customers in the country as Davao City residents cornered 3.8 percent of the same scale.
“The urbanization and proximity to the technologically developed capital are enhancing demand for Fintech solutions among Filipinos,” the analysis pointed out.
“There is immense untapped potential for further penetration of online solutions throughout the Philippines. Thus, despite high internet penetration of 71 percent, which is 14 percent higher than the global average rate, a lot of people remain underserved by banks.”
The report listed eight regions that registered low figures in terms of Fintech usage. The regions are Cagayan Valley, Bicol, MMAROPA (comprised by Occidental Mindoro, Oriental Mindoro, Marinduque Romblon, and Palawan), Eastern Visayas, Caraga, SOCCSARGEN (South Cotabato, Cotabato, Sultan Kudarat, Sarangani and General Santos City), the now defunct Autonomous Region of Muslim Mindanao and the Zamboanga Peninsula.
In contrast, most Filipino Fintech customers live in highly urbanized cities. Its survey indicated that Quezon City accounted for the biggest slice with 36.9 percent. Makati City and Manila took the second and third slots with 16.8 percent and 6.3 percent, respectively.
Such contrasting figures indicate a need for urbanization to further facilitate online lending.
The analysis also observed that a predominantly young population distinguished for extensive usage of digital solutions and advanced consumption apply for online loans 5.3 times more often than on average in the country.