Credit card delinquency: Did unemployment and inflation influence it in the Philippines from 1999-2004

The study focused on credit card delinquency or the non-payment of, or payment of any amount less than the minimum amount due within two (2) cycle dates of credit card borrowings. There are many factors that affect the occurrence of default. However, this study is limited to two (2) major macro-economic factors namely unemployment and inflation. The study used multiple linear regression analysis on the quarterly data of five (5) credit card companies. The delinquency rates, unemployment rates and inflation rates from 1999 to 2004 were taken from these companies to know the influence of these macro-economic factors on credit card default. The data gathered on delinquency rates showed no trends because of the erratic movements of the rates of the five (5) credit card companies. The test showed that unemployment would greatly affect Bank A because it is the largest issuer of credit cards in the country. Thus, it also has the largest risk exposure. Due to the restrictions presented by the limited data available, the proponents believe that by extending the years or by increasing the sample or by increasing the controlling variables, more relevant information can be drawn and it can influence the findings using the regression model