Home Credit releases 2021 Sustainability Report

The Report outlines Home Credit’s strong progress in delivering digital-led financial inclusion benefits, building on company’s history of responsible operations, with highlights of its Philippine ESG performance

Home Credit released its Sustainability Report last June 15 detailing Home Credit’s progress in delivering against Environmental, Social and Governance (ESG) principles – a framework used globally, to measure non-financial factors anchored on sustainability and ethical impact of a company or business.

The report aligns with the United Nations’ Sustainable Development Goals and covers all the company’s markets across the globe.

“This sustainability report marks an important milestone in our journey as a responsible, inclusive business, that has ESG principles firmly embedded in its values and DNA,” said Jean-Pascal Duvieusart, Chief Executive Officer, Home Credit Group.

Home Credit has been working to support customers and communities in 2021 as they navigated the continued challenging global environment.

The report highlights key themes and trends that impact the business, based on a materiality assessment.

Key 2021 report highlights at a glance:

  • Serving the underserved

23% of Home Credit customers were first-time borrowers

  • Financial literacy

109 million people benefited from Home Credit financial literacy initiatives in 2021

  • Equitable lending

43% of Home Credit customers are women

  • Zero interest

44% of our consumer loans have 0% interest, thanks to partnerships with retailers and manufacturers

  • Payment holidays

2.2 million customers were given the option of payment holidays and deferred payments to help them better cope with the pandemic in 2021

  • Giving back to communities

USD1.3 million dedicated to community direct aid in one of over 50 projects across the markets

  • Carbon footprint

12k tCOequivalent in scope 1 & 2

  • Circular economy

4.5k phased out office devices refurbished and resold or donated

The materiality assessment sets out the most significant themes for Home Credit. It was compiled with reference to industry leading benchmarks such as the Standards and Practices for Responsible Inclusive Finance by the Social Performance Task Force (SPTF), Principles for Responsible Banking by the United Nations Environment Programme Finance Initiative (UNEPFI) and Materiality Finder by the Sustainable Accounting Standards Board (SASB).

In addition, the Home Credit Sustainability Report was prepared with reference to the Global Reporting Initiative (GRI) Standards.

Spotlight on the Philippines

In the Philippines, Home Credit has been the pioneer of financial inclusion since 2013, providing access to useful, affordable and responsible financial products and services to over 8 million Filipinos.

“Our mission at Home Credit is to empower every Filipino to be financially capable. Our robust network of over 10,000 POS locations and expanding online presence presents us whenever and wherever our customers need us. With our strong brand partnerships and community across the country, we have become a one-stop ally for every Filipino,” said David Minol, Home Credit Philippines’ Chief Executive Officer. “We have provided over 178 billion pesos in loans to our customers over the past 8 years, those loans have become a lifeline for most Filipinos, especially for those without access to bank or credit.”

Home Credit Philippines has been at the forefront of financial inclusion and innovation. Its Home Credit Marketplace app has evolved into a vibrant hub where customers can browse products, compare prices, and buy from local retailer. As part of our efforts to further to provide options for our customers, we have also expanded our partnerships from major retailers to specialist and medium to small brick and mortar stores- majority of which are based in smaller, underserved cities. By end of 2021, our marketplace now feature products from over 70 merchants across the Philippines expanding availability of products beyond consumer electronics and gadgets to furniture, home appliance, and even sports and lifestyle equipment.

At the height of the global pandemic, HCPH also partnered with BPI/MS Insurance Corporation, one of the Philippines major insurance providers to address the growing demand for insurance services in the country and provide value-added services to Home Credit’s customers, to help become more financially resilient despite the uncertainties.

Building on the learnings of the pandemic, Home Credit has also created its enhanced Safe Lender Toolkit, which aims to help customers resolve unexpected financial difficulties. The toolkit provides a range of support options from short-term through deferred payments and collection exclusion to long-term with debt resolution support, dynamic repayments and settlements.

“Financial inclusion has always been at the heart of our business approach. Affordability assessment sits at the core of this approach. We understand the importance of not over-debting customers and working with them to ensure the right product fit for their particular circumstances,” said Zdenek Jankovsky, Home Credit Philippine’s Director and Treasurer. “Taking this approach allows our customers to build a more financially resilient future, despite rising global uncertainties.” he added.

ESG principles have long driven Home Credit’s portfolio development- whether it’s a 0%  interest product that helps someone buy their first smartphone, a revolving loan that provides more resilient cash flow or a  payment holiday that helps a customer whose financial circumstances have suddenly changed.

Linked to this solid ESG performance are ESG-linked loans that have been granted to Home Credit Philippines to further its mission.

In December 2021, HCPH closed it first ESG-linked credit facility with Deutsche Bank noted as a groundbreaking transaction with focus on expanding credit access to underserved communities in the Philippines, including female and first-time borrowers, and increased provision of financial literacy programs in the country.

As of June 20, Home Credit Philippines in partnership with Praxis, and the Manila Broadcasting Corporation has launched a financial literacy radio segment named “Payo para sa Life: Pera Wais Tips” aired daily across DZRH radio stations nationwide, to expand HCPH’s flagship “Wais sa Home” financial literacy program.

In May 2022, HCPH and Citi pioneered a Php 420 social finance facility with a first of its kind support for mobile device purchases for Filipinos. Half of the loan is devoted for women to aid purchase of basic digital devices to empower them to connect to the internet, access essential services such as digital banking, financial literacy, and for running their own online businesses or avail of online education.

“With more ESG-linked loans, we’re even better placed to continue to deliver equitable and transparent access to financial services for our communities,” said Jean Lafontaine, Home Credit Group’s Head of Funding and Investor Relations.