Household savings increased in the first quarter as a result of higher salaries and remittances, along with improving financial literacy among Filipinos, the central bank’s latest Consumer Expectations Survey (CES) shows.
The CES said that the number of households with savings increased to 28.9 percent in the first quarter compared to 26.2 percent in the previous quarter.
The survey also showed that the percentage of households that expected to save money in the first quarter increased to 38.3 percent from 34.6 percent in the fourth quarter of 2013.
“Respondents stated that they are setting aside some amount as savings for the following reasons: for emergency, health and hospitalization, retirement, education, and business capital and investment,” the Bangko Sentral ng Pilipinas (BSP) said.
According to the latest CES, almost 65.3 percent of household savers have bank deposit accounts while 22.9 percent kept their savings at home and 11.6 percent put their money in cooperatives, paluwagan (a savings scheme) and other credit/loan associations.
BSP Deputy Governor Diwa Gunigundo said that the upward trend in the savings behavior of Filipino households can be attributed to higher salaries and the various efforts of the banking system in conducting financial literacy programs.
On the other hand, the BSP survey said that the number of households with savings that are receiving remittances also picked up in the first quarter, the second highest percentage since the nationwide survey started in 2007.
Of the 560 households included in the survey, the percentage of overseas Filipino worker (OFW) households that utilized their remittances for savings rose to 45.4 percent from 41.6 percent in the fourth quarter of 2013.
Additionally, OFW households that allocated their remittances for the purchase of property increased to 13 percent from 12 percent in the previous quarter, while those that apportioned part of their remittances for investment and purchase of consumer durables and motor vehicle went down compared to the previous quarter’s results.
“It means that remittance receiving households are really more empowered to engage in the formal financial system. Remittances are not only a power to the source in consumption but it also helps in terms of deepening financial intermediation,” BSP Assistant Governor for the Monetary Policy Sub-sector Cyd Tuano-Amador said.
The CES is a quarterly survey of households drawn from the National Statistics Office’s Master Sample List of Households, which is considered a representative sample of households nationwide. The survey was conducted from January 21 to February 3, 2014 and surveyed 5,870 households nationwide.