LEVEL OF KNOWLEDGE IN ONLINE LOAN APPLICATION IN NORTH CALOOCAN: BASIS FOR FINANCIAL LITERACY PROGRAM
Keywords:
online loan applications, financial literacy, data privacy, credit scores, collection payment policy, terms and conditions, demographic profile, loan approval process, debt management, consumer awareness, anova analysis, financial decision-making, digital lendinAbstract
With the rise of online loan applications in the Philippines, many individuals turn to financial credit and loans to address financial difficulties, often without fully understanding the potential risks. A lack of financial literacy among borrowers can lead to excessive debt, as many are unaware of loan terms, interest rates, and repayment obligations.
This study, conducted in North Caloocan, aims to assess the financial literacy of online loan users and identify gaps in their knowledge. By understanding borrowers' level of awareness, the research seeks to propose effective financial literacy programs to help individuals make informed financial decisions and avoid falling into debt traps. This study will employ a quantitative research approach, specifically the descriptive method, to measure the variables under investigation. This approach was chosen to effectively assess the level of knowledge on online loan applications among residents of North Caloocan and provide a comprehensive understanding of their financial literacy. The study's findings, based on the demographic profile of respondents, indicate that the majority (59%) are female, while 41% are male. In terms of income status, most online loan application users earn less than ₱10,000 or between ₱10,001 to ₱25,000, accounting for a combined 84% of respondents.
Regarding the level of knowledge on online loan applications:
Respondents are “Very Knowledgeable” about data privacy.
They are “Knowledgeable” about collection payment policies, credit scores, and terms and conditions.
The study also examined the reasons for using online loan applications, yielding an average weighted mean of 5.50, indicating that respondents consider these reasons a “serious” matter. Similarly, the challenges encountered when using online loan applications also received an average weighted mean of 5.50, reinforcing the seriousness of these concerns.
Furthermore, ANOVA results show no significant difference in users' level of knowledge on online loan applications based on their demographic profile. The results indicate that respondents are "Very Knowledgeable" about data privacy and "Knowledgeable" regarding collection payment policies, credit scores, and terms and conditions when using online loan applications. Furthermore, statistical analysis shows no significant difference in users' level of knowledge based on their demographic profile.
