November 2023

Credit is a useful instrument for assisting people in reaching their financial objectives. Those with credit access can make purchases today, on the basis of an agreement to pay for products and services later.

But it’s crucial to understand the difference between “bad” credit—which is unaffordable—and responsible credit, or “good” credit.

The difference between good and bad credit

Whether it’s used for purchases that improve one’s quality of life, to handle unexpected bills, or to take advantage of certain perks such as rewards points or special discounts, good credit is credit that a borrower can affordably repay.   

As credit is a tool, there are cases where tools can be misused. Credit becomes bad credit when you use it to take on debt you can’t afford to repay. The longer you go without paying, the more likely you could run into fees, damage your credit score, see interest rise, and possibly face legal issues. By saddling yourself with the responsibility to take care of unaffordable outstanding debts, you run the risk of closing yourself off from better economic opportunities that credit used responsibly can unlock.  

The impact of bad credit  

The repercussions of taking on bad credit can be seen as a possible contributing factor to the negative stigma surrounding credit in the Philippines. In the country, the word credit is synonymous with the Tagalog word “utang” which carries notions of bad debt and financial irresponsibility.

The recent TransUnion Philippines Credit Perception Index study highlighted how negative stigma has shaped how Filipinos see credit. Findings showed that 58% of Filipinos believe that users of credit products tend to overspend while 55% do not want to be indebted.

As a result, in lieu of turning to formal financial institutions, there is a high reliance among Filipinos on family, friends, and other informal sources of borrowing. These sources include unregulated “5-6” moneylenders who issue small loans with often high interest charges over an agreed period, and “sangla-ATM” schemers who require physical ATM cards and a person’s personal identification numbers (PIN) as collateral for loans. Relying on these measures often puts borrowers at huge disadvantages that make it difficult for them to break free from their debts.

The importance of championing responsible credit use

While much work remains to be done to fully dispel the negative stigma surrounding credit in the country, more Filipinos are seeing the opportunities that come from having access to credit. Findings from the Q3 2023 TransUnion Philippines Consumer Pulse Study showed that 62% of Filipinos agreed that credit can help them access new opportunities that can lead to a better quality of life (i.e. buying a house, starting a business, financing my education, buying a car) – an increase of four percentage points from findings in Q2 2023.

Additional results from the study found that 72% of Filipinos agree that credit is widely available and easy to apply for as long as good financial management is demonstrated, an increase of four percentage points from the previous quarter. Asked whether they were comfortable owning credit accounts such as loans and credit cards, 41% of Filipinos expressed being comfortable, an increase of six percentage points from Q2 2023.

With perceptions changing and with more Filipinos growing accustomed to the ownership of credit products, the formal financial sector must continue to work together on educating Filipinos on responsible credit use and how it can pave the way towards better financial inclusion in the country.

To help promote responsible credit use, TransUnion Philippines’ credit reporting solutions help people understand and improve their credit status. Checking your credit report can help consumers stay informed of factors affecting their credit score and can help them take action to improve it. This can help people act to improve their credit standing faster.  

Other data, including telco data, is a useful tool for evaluating consumers’ creditworthiness, especially for New-to-Credit (NTC) consumers who are limited by their lack of credit history. TransUnion Philippines, a global provider of risk information, helps lenders find lower-risk borrowers and offers them better terms and pricing on credit products and services by leveraging information and insights from alternative data. When TransUnion Philippines uses information for good, it means this.

Opportunities are created by credit. It is feasible for more Filipinos to achieve more in life by emphasizing the advantages of having excellent credit and persistently promoting education on the proper use of credit.

Get your TransUnion Philippines Credit Report HERE.

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How To Be A Millionaire

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The 21st anniversary celebration of CHILD Haus, an organization established by “Mader” Ricky Reyes to serve as a pillar of hope for kids affected by cancer, took place in the SM Mall of Asia Music Hall. The Sy family has continuously been a major backer of the establishment throughout its history: Henry “Tatang” Sy, Sr. in the early years and SM Prime Holdings Inc. in the last ten years. Hans Sy, the chairman of the executive committee, is carrying on his father’s legacy.

Mr. Sy and “Mader” Ricky led the event, and invitations were sent to a number of people and organizations that have supported CHILD Haus throughout the years. There were also a lot of kids there who had been “adopted” by CHILD Haus and were now living there. The media was also present and acknowledged the significant impact that organizations such as CHILD Haus make, as well as how they serve as the “answered prayers” for countless children and their parents.

Three CHILD Haus stories, featuring Aya, Laura, and Jessa, were turned into video vignettes that highlighted the message of hope and the life-saving work of the organization. While it is easy to describe such events as heartwarming and tear-jerking, it was truly remarkable to witness even the most seasoned press photographers being moved to tears by these videos. This is a clear testament to the profound impact that these testimonials had on the audience at the event.

After ‘Mader’ Ricky’s heartwarming welcome, Mr. Sy himself took the stage to present plaques of appreciation to the many friends of CHILD Haus whose generous donations have made the organization’s life-saving work possible.

Those suffering from cancer and ‘adopted’ are provided food and shelter. There are presently two CHILD Haus locations – one in Manila, near the Philippine General Hospital, and one in Quezon City. Until the children are declared cancer-free and/or have completed their treatments and medical procedures, one child and one parent are allowed to live at CHILD Haus. If it’s an infant, both parents can stay.

Karylle, a CHILD Haus regular and ardent supporter, led the kids in a lively song written by her husband, Yael Yuzon. Subsequently, the daughter of “Mader” Ricky performed a reworked version of “Handog” by Florante, tailored to the emotions of the kids at CHILD Haus. The kids had learned and rehearsed these two songs as a way to say “thank you” to all of the visitors who had contributed to the “haus” becoming a reality.

Ultimately, “Mader” Ricky and Mr. Sy agreed on the importance of this occasion, which honors 21 years of kindness, tenacity, and the giving and sharing attitude.

You can follow @smsupermalls on social media or visit www.smsupermalls.com to learn more about SM’s motivational events and stories.

At the 43rd Anniversary of the Civil Security Group at Camp Crame, Gilren Bajado, a female security guard for RJC Security Solutions, was named the Outstanding Security Guard of the Year. PNP Chief PGen Benjamin C. Acorda Jr. presided over the recognition event. Mr. Almus J. Alabe, Senior Assistant Vice President of SM Supermalls Customer Relations Services, and Harold James E. Herrera, Regional CRS Manager, was also present to see the award ceremony.

The extraordinary deed of honesty and integrity that LG Bajado committed on August 3, 2023, in SM Cinema, SM City Marikina, is the source of her extraordinary accomplishment. While performing her clearing duties, she found a misplaced black pouch that contained 64,800 pesos, as well as various ID cards and ATM cards that belonged to Mr. Starsky D. Paunan, a 44-year-old Palarong Pambansa employee.

Without hesitation, she reported this to the CRS office, ensuring the safe return of the lost valuables to their rightful owner. Her integrity, honesty, and dedication have earned her this prestigious recognition and admiration from her peers and superiors.

SM Supermalls and RJC Security Solutions take immense pride in her achievement, as it reflects the company’s core values of professionalism, honesty, and integrity. Her commitment to her duties, her sense of responsibility, and her exemplary character have brought honor not only to herself but also to RJC Security Solutions as a leading provider of comprehensive security services.

SM Supermalls’ dedication to upholding the highest standards of excellence is strengthened by the announcement that LG Gilren Bajado has been named the Outstanding Security Guard of the Year. The organization constantly aims to offer security solutions while making certain that all of its workers uphold the greatest moral standards.

SM Supermalls would like to congratulate LG Gilren Bajado on her remarkable accomplishment and for setting a bright example of professionalism and honesty. Her deeds inspire us all and serve as a reminder of the power one person may have in creating a society that is more reliable and safe.