Digital Lending Preferences among Community Members in Digos City: A Conjoint Analysis
DOI:
https://doi.org/10.54536/ajebi.v5i3.8636Keywords:
Community Members, Conjoint Analysis, Digos City, Digital Lending, Loan Attributes, PreferencesAbstract
Digital lending has emerged as an alternative financing option for individuals who experience difficulty in accessing traditional bank loans due to strict requirements or lengthy processing time. However, despite their growing presence, there is limited evidence on which loan preferences community members value most when choosing digital lending services in Digos City, Davao del Sur. This research aimed to determine the relative importance of digital lending attributes among community members in Digos City, Davao Del Sur and to identify the most and least preferred combinations of these attributes. The study surveyed 330 community members in Digos City using simple random sampling. A choice-based conjoint design was used to examined the financial decision-making and preferences of the community members for digital lending in Digos City. In addition, Key Informant Interviews were conducted to establish the preferable digital lending attributes. The results revealed that attributes with the highest importance value was terms and interest rate, followed by payment period, approval speed, and accessibility. Respondents strongly choose the loan combination of 24 months with 0.75% interest per month, automated instant approval, payable in monthly installments, and a fully digital end-to-end application. It was recommended that digital lending providers should prioritize creating digital loan services with competitive interest rates, longer repayment terms, flexible monthly installments, and secure automated approval systems to better meet the borrowers preferences in Digos City.
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