In the rapidly evolving landscape of financial technology, the digital lending market in the Philippines is projected to witness remarkable growth, potentially reaching a valuation of $1 billion by the latter half of 2025. This forecast stems from research conducted by Digido, a prominent online lending platform in the country, which indicates that the demand for online financial services among consumers is surging.
The digital lending sector, which encompasses registered non-bank digital lenders and digital banks, is expected to significantly outperform previous years. The market size is projected to rise to approximately $796 million by the end of 2024, up from $693 million recorded in 2023. Notably, non-bank digital lenders are anticipated to account for 55.2 per cent of the market, valued at around $556.5 million, while digital banks are expected to hold 44.8 per cent, amounting to $451 million.
Data from Digido reveals that in the ten months leading up to 2024, there were 58.9 million app downloads associated with both non-bank digital lenders and digital banks. Should current trends continue, the combined number of downloads for these services could escalate to approximately 73.5 million in 2024, marking an impressive increase of 56.4 per cent compared to 2023.
Historically, the digital lending market in the Philippines has demonstrated a steady growth trajectory, expanding at an average rate of 28 per cent per year from 2013 to 2023, which translates to an annual increase of about $68 million.
Rose Arreco, the business development manager at Digido, commented on these trends, stating: “Our latest findings affirm the majority of Filipinos’ growing pivot towards digital sources of credit as part of their personal finance management. We are optimistic that these lending segments will be able to maintain their high growth rates in view of its accessibility for the financially underserved, progressive government support and various projects promoting further digitalisation.”
Moreover, Arreco pointed to the generational shift influencing this growth, noting that a third of the Philippines' population belongs to Generation Z, a demographic that is particularly receptive to innovative financial technology solutions delivered via mobile applications.
As the digital lending market continues to evolve, it appears to be firmly embedded in the financial strategies of a growing segment of the population, indicating a profound transformation in how Filipinos interact with credit and financial services.
Source: Noah Wire Services