Savings rate in PH still low, BSP survey shows
Some 40% of households with savings keep their money at homeBy Michelle V. Remo |Philippine Daily Inquirer
Only one out of four Filipino households has savings, indicating the vulnerability of the majority to risks emanating from emergency situations that require spending.
Moreover, among the households that have savings, a significant 40 percent still keep their extra money at home rather than depositing them in banks.
These are findings of the first survey on consumer savings conducted by the Bangko Sentral ng Pilipinas, which indicated the need for further promotion of financial literacy among Filipinos.
“The findings suggest that there has to be more economic and financial learning programs that will teach people the merits of savings and the benefits of putting savings in banks rather than keeping them at home,” BSP Deputy Governor Diwa Guinigundo said in a recent briefing.
The survey, which was conducted nationwide from Jan. 21 to Feb. 1, 2013, covered 5,670 households and had a response rate of 96.9 percent.
Results particularly showed that only 24.5 percent of the respondent households reported to have savings.
Of the households with savings, two out of three have bank accounts.
According to the BSP, the low-income households have the biggest tendency to keep their savings at home rather than in banks.
“There is a correlation between income and the inclination of households to save in banks. Over time, as economic conditions improve, there will be more people saving and putting their savings in banks,” Guinigundo said.
About half, or 50.5 percent, of the respondents were households earning less than P10,000 a month. Households earning between P10,000 and P29,999 a month accounted for 35.7 percent of the respondents, while those earning at least P30,000 a month accounted for 13.8 percent of the respondents.
The BSP is undertaking an economic and financial literacy campaign, which involves the conduct of road shows in various provinces and in other countries hosting overseas Filipino workers.
The BSP said the private sector was encouraged to undertake similar financial literacy campaign.
In the meantime, the central bank said households partly or fully dependent on remittances sent by family members working overseas were encouraged to save and invest.
A BSP survey on the spending habits of OFW-dependent households during the first quarter showed that 42.5 percent of the 464 households surveyed had reported putting aside a portion of their money for savings.
Another 5.8 percent used a portion of their money for investments, down from 8.5 percent a year ago.