Filipinos are the most worried about their financial situation compared to those in Asia-Pacific countries, a study commissioned by a banking software solutions provider showed.
The study by Forrester Consulting said Filipino consumers are also more worried and uncertain, and one of the reasons for this concern is debt.
“Debt management is a challenge for 70% of consumers in the Philippines, and it’s their biggest challenge when it comes to managing their finances,” Backbase said.
Backbase added that the top three financial wellness products, services and experiences that Filipinos are least satisfied with their primary bank are financial management tools, incentives for better financial habits, and banking with a provider. financial services that helps them identify vulnerabilities and financial hardship risks.
While Philippine banks offer financial education tools, only half of them focus on the other two requests, he said.
“Banks that simplify financial well-being and provide personalized solutions will help reduce debt and, in the long run, build customer loyalty,” the software solutions company said.
Many banks in the Philippines are struggling to catch up and meet new demands as customer expectations and the banking landscape are constantly changing, he added.
“70% say keeping pace with customer expectations and staying both profitable and relevant is a major challenge. That’s above the APAC (Asia-Pacific) average of 63%, ”Backbase pointed out.
Another big challenge, he added, is increasing competition and / or disruption from new entrants into the industry. To stay ahead of the competition, Philippine banks should learn from the experience of banks in other countries.
Many financial institutions in the Philippines admit that developing digital money management solutions presents distinct organizational barriers. Organizational silos (78%), competing priorities (74%) and a limited perspective on consumer data (74%) are the top three issues highlighted by respondents.
“To meet these challenges, banking leaders should take steps to transform their banks by creating digital cultures and investing in technologies that can break down silos and encourage open finance,” Backbase suggested.
He said 62% of banks recognize the importance of financial literacy tools in driving business results such as customer acquisition, engagement, retention and retention. Over the next 12 months, 60% of banks plan to use digital money management solutions.
“Thanks to advances in digital technology, banks can now offer digital services to help manage debt properly,” said Iman Ghodosi, Backbase regional vice president for Asia Pacific.
Unfortunately, trust in digital banks remains low, with just 18% of respondents indicating they trust a digital bank compared to 60% for a traditional bank.
“We can expect less confidence in new ways of doing things. However, we have found around the world that the more information and control we can put in the hands of clients to make their own informed financial choices, the more they will trust the organizations offering them this opportunity, ”he said. declared Ghodosi.