- Financial optimism broadly holds with 74% of Filipinos expecting their income to improve over the next 12 months
- Household budgets adjust as Filipinos lean into prudent financial behavior – 55% report cutting discretionary spending and increasing saving (49%) and turning to new credit products (48%)
- Despite strong interest in credit, 60% of prospective borrowers drop out of the process primarily due to cost, other funding sources and eligibility barriers
Manila – Filipino consumers remain broadly optimistic about their financial future, but rising living costs are increasingly reshaping how households spend, save and borrow. The Q2 2026 Consumer Pulse Study by TransUnion (NYSE: TRU) shows that while the majority continue to expect their household finances to improve in the coming year, confidence is being tempered by inflation and ongoing uncertainty surrounding the broader economic environment.
Optimism Broadly Holds, but Affordability Pressures Keep Households Cautious
Household income was broadly stable this quarter. While slightly below the 41% seen in Q2 2025, more than one-third (38%) of consumers still reported an income increase over the past three months. Meanwhile, 43% saw no change and only 19% experienced a decline, suggesting that although momentum has eased, overall, the majority of households are not slipping backward. Looking ahead, expectations for earnings remain strong, with 74% anticipating income growth over the next 12 months – more than the 73% recorded a year ago. This resilience continues to underpin a positive financial outlook, as 74% of consumers expressed optimism about their household finances in the year ahead.
Despite this optimism, signs of financial strain persist. Inflation remains the top concern, cited by 84% of consumers in their top three biggest worries affecting household finances in the next six months, and will likely persist as the pass-through effects of the oil price shock materialize. Other key pressures on household finances include job security (54%) alongside recession and interest rates (both at 44%). While data from the Philippine Statistics Authority (PSA) show inflation easing from 7.2% in April to 6.8% in May 2026, the May rate remains among the highest for that month since 20211. Affordability pressures are evident, with TransUnion’s research showing nearly half of consumers (45%) expecting to be unable to fully pay at least one of their current bills or loans, slightly up from 44% in Q2 2025.
“Filipino households are entering the second half of the year optimistic but clear-eyed. They expect their incomes to stay resilient, which keeps confidence broadly intact – yet they feel the weight of inflation on everyday costs, such as rice prices, and uncertainty over upcoming financial commitments amid broader global economic headwinds,” said Weihan Sun, senior director of research and consulting for Asia Pacific at TransUnion.
Spending and Saving Grow More Cautious, with Rising Reliance on Credit
In the face of persistent inflation and rising living costs, households are responding with deliberate caution – prioritizing essential spending and actively adjusting budgets amid ongoing cost pressures. Over half (55%) of consumers reported reducing discretionary spending like dining out, travel and entertainment in the last three months, up from 47% in Q2 2025. At the same time, they reported strengthening financial safety nets: 49% added to their emergency savings, up from 45%, while fewer (8%) drew on retirement funds, down from 12% a year ago.
As part of this shift, consumers are also balancing financial resilience with a growing reliance on credit. Reported use of available credit in the last three months rose to 17% from 15% last year, and looking ahead, 51% expect their bills and loan payments to increase over the next three months, slightly more than 49% in Q2 2025.
“Across these behaviors – from trimming discretionary spending to building savings while leaning on credit more selectively – what stands out is how intentional these choices are. Filipino households are not simply responding to pressure, but prioritizing what matters and being deliberate with every peso, using credit with intention to smooth day-to-day cash flow and bridge spending gaps. This shift toward more active financial management is an encouraging sign of growing financial maturity,” added Sun.
Credit Demand Stays Strong, but Cost and Eligibility Barriers Stall Follow-Through
As reliance on credit increases, it remains central to how Filipinos achieve their financial goals: more than half (58%) see access to credit and lending products as extremely or very important, unchanged from Q2 2025. At the same time, accessibility remains steady, with 44% reporting sufficient access – which is also consistent with a year ago – although almost one-quarter (24%) disagree.
Credit appetite stayed high, with nearly half (48%) of Filipino consumers planning to apply for new credit or refinance existing credit in the next year. Among those who said they would apply, growth is driven by everyday products such as personal loans, rising from 45% in Q2 2025 to 52%, and credit cards, increasing from 31% to 35%. In contrast, demand for mortgages softened to 12% from 17% a year earlier.
Despite robust interest in credit, many consumers continue to encounter obstacles along the borrowing journey. Three in five (60%) of those who considered credit applications abandoned their plans, up from 57% a year ago. The primary reason for abandoning applications was the cost being too high (35%), followed by finding an alternative funding source (32%) and income or employment status (28%).
“More Filipinos are turning to credit for the flexibility it offers, especially in uncertain times. However, when six in ten of those who considered borrowing walk away from a credit application, the issue is more friction than intent. The opportunity for lenders is to make credit more inclusive, so responsible borrowers are not lost to cost, complexity or eligibility barriers, while consumers can play their part by maintaining healthy credit habits. That is how we turn credit access into lasting financial resilience,” said Sun.
TransUnion’s Consumer Pulse Study surveyed 961 adults from April 29 to May 19, 2026. This quarterly survey examines shifting consumer attitudes and behaviors based on the dynamics of income, debt, and identity theft. Respondents ranged from Gen Z, 18-29 years old; Millennials, 30-45; Gen X, 46-61; and Baby Boomers, age 62 and above. By capturing insights across generations and financial situations, the study helps promote greater financial inclusion by informing policies, products and education efforts that meet the evolving needs of all consumers.
For more information, please view the full report of the TransUnion Q2 2026 Consumer Pulse Study.
1 Summary Inflation Report Consumer Price Index, May 2026, Philippine Statistics Authority
