Carmudi recently revealed its research results on the growth of the Philippine Car Financing sector. The company prepared the report to provide an outlook on the current and future state of car financing in the country and how it affects consumer attitudes towards credit. Unsurprisingly, it showed how much we, Filipinos, love cars.
The research shows that 76 percent of Filipinos are planning to purchase a car in the next two years, compared to 65 percent in other emerging markets. In terms of consumer behavior, our country has the highest level of vehicle upgrade, with 96 percent planning to upgrade their cars when they reach a more financial and stable condition.
Meanwhile, attractive consumer loan programs have boosted the strong demand for passenger cars and commercial vehicles. The growth in consumer loans was driven by a 26 percent increase in auto loans, which translated to PHP 244.61 billion.
As consumer loans continue to grow, as local banks continue to come up with new strategies such as lower interest rates, attractive product offerings, and freebies to boost their share of the industry.
“Car financing has always been an option that consumers in the Philippines look at when buying a car, and data shows that the demand for auto loans in the country continues to increase. With the growing economy and increase in demand for passenger cars, we believe that more of our Filipino customers will seek assistance about financing options,” said Subir Lohani, managing director of Carmudi Philippines.
With the Philippine government initiating ongoing economic reforms and a high inflow of remittances, forecasts predict that consumer lending will flourish at a double-digit rate, driving consumers to further invest in cars and motorcycles.
As more banks invest in consumer loans, consumer credit is also expected to increase and become more widely accessible to all Filipinos.