Financial Literacy in the Philippines 2024: Key Statistics

Financial literacy—the capacity to understand and manage personal finances—is key to making informed financial choices and achieving long-term financial stability. However, the financial literacy rate in the Philippines remains a significant concern. Recent reports show that only about 25% of Filipino adults are financially literate.

In 2024, the Bangko Sentral ng Pilipinas (BSP) and various institutions are actively working to improve this figure, recognizing that a lack of basic financial knowledge limits opportunities for growth and exposes people to financial risks.

This article will explore the current state of financial literacy in the Philippines, examine the causes of financial illiteracy, and suggest potential solutions to empower Filipinos with the financial knowledge they need.

What is Financial Literacy?

Financial literacy is the ability to effectively manage money through essential skills such as budgeting, saving, and making informed financial decisions.  

Budgeting helps you create and follow a spending plan, ensuring you meet both daily needs and long-term goals. Saving and investing are vital components of financial education, especially as living costs continue to rise, allowing you to set aside funds for future objectives.

Effective debt management is equally important, enabling Filipinos to handle loans, credit cards, and other financial obligations without unnecessary stress. Financial planning, including setting goals for retirement, education, and major purchases, achieves long-term financial security. 

Addressing Financial Literacy Gaps

Local studies about financial literacy in the Philippines, especially during the pandemic, have highlighted significant gaps in essential skills, especially among students. As awareness of these gaps grows, the need for improved financial education becomes more urgent, helping Filipinos make informed decisions in an increasingly challenging financial environment.

Customer analytics solutions can provide valuable insights into financial literacy needs across different demographics, allowing for the development of targeted initiatives to address these gaps. Partnering with a business intelligence company can help assess data-driven insights, which can guide the creation of accessible financial education programs.

Additionally, as digital payments become more common, understanding cashless payment options in the Philippines is crucial for helping Filipinos manage their finances more efficiently.

Key Statistics on Financial Literacy in the Philippines

In 2024, the state of financial literacy in the Philippines reveals both significant challenges and areas for improvement. Financial literacy rates remain low, with recent statistics showing that only about 25% of Filipinos understand basic financial concepts. The majority still lack essential skills in budgeting, saving, and debt management. 

Although there has been slight growth in financial literacy from previous years, the progress remains slow, underscoring the need for more accessible and inclusive financial education.

A deeper analysis of demographic trends reveals disparities in financial literacy among different age groups and regions. Millennials and Gen X exhibit slightly higher financial literacy rates, with millennials at around 30% and Gen X at 28%. This increase is likely attributed to greater access to financial tools and online resources. 

Older generations, such as Baby Boomers, report lower financial literacy rates, with only about 15% displaying basic financial skills. Gender also plays a part, as studies show that Filipino men tend to score slightly higher in financial literacy than women. However, this gap is gradually narrowing as financial education efforts become more inclusive.

Regionally, urban areas like Metro Manila report higher literacy rates than rural provinces. Urban residents have greater access to financial services, resources, and educational programs, contributing to an average literacy rate of around 35% in cities versus just 20% in more remote areas. 

This urban-rural divide reflects a broader trend across Southeast Asia, where urbanization influences access to financial education and resources.

A comparison of current figures to prior years shows a positive, though gradual trend. Since 2020, financial literacy in the Philippines has increased by about 5% across all demographics, largely driven by initiatives from the BSP and other financial institutions aimed at expanding awareness during the pandemic.

Despite this growth, the Philippines still lags behind other Southeast Asian countries, such as Malaysia and Singapore, where financial literacy rates exceed 50%. This international comparison underscores the need for more comprehensive financial literacy programs to better equip Filipinos with the knowledge needed to make informed financial decisions.

Causes of Financial Illiteracy in the Philippines: Challenges and Opportunities

One of the main factors contributing to financial illiteracy in the Philippines is the lack of financial education. In many schools, financial literacy is either minimally integrated or absent from the curriculum. As a result, students grow up without formal training in budgeting, saving, and investing, leaving them ill-prepared to handle their finances as adults. 

Similarly, few workplaces offer financial literacy programs, missing an opportunity to promote sound financial habits among employees.

Poverty and economic inequality further exacerbate the problem. Many Filipinos are forced to prioritize immediate needs over long-term financial planning, which hinders their ability to focus on financial education. For low-income families, limited resources restrict access to financial literacy programs, perpetuating a cycle of financial vulnerability. 

Studies suggest that when individuals have little disposable income, they are less likely to seek out financial education, viewing it as an unnecessary expense rather than a vital skill.

Cultural factors also play a substantial role in financial illiteracy in the Philippines. Traditional views around money and saving can discourage open discussions about finances. 

For many, talking about money is seen as inappropriate or even taboo, and some believe that saving is only feasible for wealthier individuals. This mindset often leads to poor financial habits and a lack of preparation for unexpected financial challenges, reinforcing generational financial insecurity.

Additionally, limited access to financial services in rural and remote areas presents another major barrier. Many rural communities lack banks, financial institutions, and access to online financial services, which limits their exposure to essential financial products like savings accounts, loans, and insurance. 

Without access to these resources, rural Filipinos miss opportunities to learn about financial management, further isolating them from potential pathways to financial growth.

Lastly, the complexity of financial products often discourages Filipinos from engaging in financial planning. Products like insurance, investments, and retirement plans may seem intimidating without clear explanations or proper guidance. This complexity highlights the need for simplified and culturally relevant financial information, especially for first-time users.

Furthermore, bank customer risk assessments can add a layer of complexity, further deterring individuals from seeking financial products and services.

To address these challenges, a multi-faceted approach is needed. This includes reforms in educational policy to integrate financial literacy, efforts to bridge the rural-urban divide in financial services, and culturally sensitive programs that encourage open discussions about money. By empowering Filipinos to make informed financial decisions, we can foster greater financial stability and security nationwide.

Solutions to Improve Financial Literacy 

The government has launched several financial education initiatives targeting both students and adults, spearheaded by agencies like the Department of Education (DepEd) and BSP. Improving financial literacy in the Philippines requires a collaborative effort from the government, financial institutions, and private organizations. 

DepEd’s integration of financial literacy into the K-12 curriculum equips young Filipinos with essential financial skills from an early age, helping to bridge knowledge gaps. Meanwhile, the BSP supports workshops that educate adults on key topics such as budgeting, saving, and investing, addressing generational gaps in financial knowledge.

Financial institutions, including banks, insurance companies, and fintech startups, are also contributing by offering free workshops and seminars. Many banks host regular sessions on personal finance management, while insurance companies focus on educating Filipinos about the benefits of insurance and long-term financial planning. 

These workshops help demystify complex financial products and encourage Filipinos to take an active role in managing their finances.

Digital tools and online resources are also pivotal in enhancing financial literacy in the Philippines. Apps like GCash offer practical ways to manage finances, while online courses from platforms like Investopedia offer accessible financial education. Additionally, websites such as the Philippine Deposit Insurance Corporation’s financial literacy portal guide users on topics like debt management, saving, and investing.

These digital initiatives give Filipinos the knowledge and tools necessary for financial independence, fostering a nationwide culture of informed financial decision-making and long-term financial security.

Empower a Financially Literate Philippines.

Financial literacy remains a challenge in the Philippines, with the low literacy rate highlighting the pressing need for accessible and inclusive financial education across all demographics. 

While initiatives by the BSP and educational institutions have driven modest growth, persistent issues such as poverty, cultural attitudes toward money, and limited access to financial services in rural areas continue to hinder progress.

Addressing these challenges requires coordinated efforts and innovative solutions to empower Filipinos to make sound financial decisions. Interested in how advanced customer analytics solutions can support these efforts? Request a demo today to see how data-driven insights can enhance financial literacy initiatives nationwide.