According to the latest study of Bangko Sentral ng Pilipinas (BSP), 77% of adult Filipinos remain unbanked and have limited access to financial support.
While the financial gap remains, majority of the Filipino working adults have now considered relying on digital platforms to settle their bill payments and buy products online—which grew from 6.3% to 9.9% based on The Global Findex 2017 Financial Inclusion survey.
However, many Filipinos still find it hard to cope up with the stress they feel when they are faced with their own financial challenges. They feel ashamed when speaking about their financial concerns, and this could lead to affecting their overall well-being.
PwC’s Employee Financial Wellness Global Survey says many employees are struggling with their financial problems such as settling debt payments and receiving insufficient compensation to keep up with their cost of living. Employers will need to assess their programs if these are effectively addressing the financial concerns of their employees.
We believe it too and it is probably the case in your company. The lack of productivity due to financial stress may affect the quality of your employee’s work, retention, and many more—even if you don’t know it.
But where does Financial Wellness play an important role in the workplace? As an employer, how can you take the responsibility to improve it?
Identifying your Employee’s Financial Stress
Financial Wellness involves a process of successfully learning to manage finances with a sense of responsibility and security. As an employer, it’s important to start from identifying the root causes of why your employees feel stressed at work.
- Where do financial worries come from?
A vicious cycle of debt may start when employees have limited savings with overwhelming expenses to manage. The need to borrow money starts when they no longer have available options to efficiently deal with their expenses. They refer to banks and lenders but fail to get immediate financial support due to a poor credit history.
- What happens in the workplace?
Financial worries trouble relationships between employees, especially when informal lending is operating. In the case of a high rate of stress, some employees leave their job to find another one with better compensation and benefits. Financially stressed employees tend to be more absent and less productive.
- What are the impacts for the company?
Stressed employees mean additional costs for the company to finance trainings and hirings. It also has an impact on employee retention especially in the BPO industry where employees are younger, more volatile, and with low salaries. They may leave their job as soon as they face debt. This could result in a negative effect for the company, both financially and for its brand reputation.
Providing Solutions for your Employees
We believe at Uploan that there is a critical and unique role every employer can play. Once you have identified your employee’s problems, you would be able to build and provide stronger solutions in your company like the following:
- Provide Financial Education and Training: Get to know your workforce with a financial survey for example. Understand how your employees are behaving with money and if they have financial concerns affecting their work productivity level. Build awareness and educate by sharing best practices in choosing better safe lending and saving options. You can also provide each new employee with a tool kit with some key benefits programs and financial tips.
- Build Financial Wellness Management Programs: If your company offers financial services to the employees, make sure you can monitor and manage the loan applications. Identify the reasons for a loan to adapt your communication if needed. If your employees tend to borrow money for medical expenses or to pay education fees, it seems that they want to cover their basic needs.
As an employer, providing manageable financial options creates a sense of responsibility for you to make your employees feel safe and satisfied in the workplace. If they are free to manage their budget in their own way, you can make sure their financial concerns are not affecting work productivity, and relationships between your employees and your business.
It’s also a good opportunity for the company to increase employee engagement, encourage them to build and maintain better credit history, and improve their wellness in the workplace.