CPA Australia survey: Young entrepreneurs help drive robust growth in Filipino small business sector

MANILA, Philippines, May 28, 2025 /PRNewswire/ -- Filipino small businesses continue to stand out as among the most dynamic in the Asia Pacific region, with 77 per cent reporting growth in 2024 and 89 per cent expecting to expand this year.

These key findings, from the latest Asia-Pacific Small Business Survey conducted by one of the world's largest professional accounting bodies, CPA Australia. This bullish performance is largely attributed to a customer-focused mindset.

However, challenges such as constrained access to finance and slower technology adoption compared with other markets in the region are holding some businesses back.

Last year saw the highest number of growing Filipino small businesses since 2019. Reflecting this improved sentiment, 41 per cent of respondents increased their workforce in 2024, and 57 per cent plan to hire more employees in 2025.

Customer loyalty and satisfaction remain key drivers of small business success in the Philippines. Nearly half (46 per cent) of Filipino respondents cited customer loyalty as their top growth factor, while 37 per cent selected improved customer satisfaction.

Mr Rufus Pinto, a CPA Australia-qualified accountant who works in the Philippine finance industry, said: "Small businesses in the Philippines are thriving due to their exceptional customer-centric approach, which helps them to retain loyal clients and attract new ones.

"Overall, the economy maintained steady growth last year, driven by strong domestic consumption, which created many opportunities for small businesses."

Mr Pinto said the youthful profile of Filipino small business owners was a key advantage. "Our young population is a key driver of the dynamic economy," he said. "The Philippines has one of the youngest small business owner profiles in the region and their strong entrepreneurialism is driving growth in the sector."

Reflecting confidence in the business outlook, 28 per cent of Filipino respondents expect strong revenue growth from overseas markets in 2025, a three-year high that surpasses many regional counterparts.

"With a young, English-speaking workforce and a strong work ethic, the Philippines remains a top destination for outsourced services from international companies, especially for voice-based services and customer support roles. Small businesses should continue to leverage these strengths to attract more overseas clients," he said.

Despite the promising outlook and employment trends, Filipino small businesses continue to lag their regional counterparts in digital adoption. In 2024, 62 per cent of respondents reported earning more than 10 per cent of their revenue from online sales, below the surveyed average of 67 per cent.

Though 74 per cent received more than one-tenth of their revenue from digital payment technologies such as Dragonpay and GCash, close to the regional average (75 per cent), only 13 per cent sought advice from IT consultants last year, well below the Asia-Pacific average of 28 per cent.

"With a large talent pool and a focus on people-to-people connection, Filipino small businesses tend to prioritise personal connections over digitalisation and automation," said Mr Pinto. "Challenges such as limited internet access in rural areas, a large unbanked population and reliance on cash and remittances also hinder digitalisation."

However, the benefits of tech investment are clear. Among Filipino small businesses who invested in technology in 2024, 69 per cent reported improved profitability, well above the Asia-Pacific average of 56 per cent. This placed the Philippines second among all surveyed markets.

Rising costs remain the top challenge, with 40 per cent of respondents citing it as a key barrier. Access to finance is also a hurdle. While 65 per cent sought external finance in 2024, only 22 per cent found it easy to obtain, the lowest result in the region. This trend is expected to persist.

"Banks remain the primary source of funding, however only 22 per cent of respondents named them as their main lender," Mr Pinto said.

"When applying for bank finance, it usually requires documents to demonstrate how the funds will be used and the credibility of the borrowers. Filipino small businesses should set ambitious long-term goals and craft well-prepared business plans towards achieving them. These are persuasive and solid documents for securing bank loans.

"Consulting professionals, including accountants who hold the internationally recognised CPA designation, can help improve financial records and address technical issues such as taxation."     

CPA Australia's Asia-Pacific Small Business Survey collected views from 4,236 small businesses in 11 Asia-Pacific markets in November and December 2024, including 310 from the Philippines. This is CPA Australia's 16^th annual survey of small business issues and sentiment since 2009.

About CPA Australia

Founded in 1886, CPA Australia is one of the world's largest professional accounting bodies representing more than 175,000 members working in over 100 countries and regions around the world including more than 20,000 members in Southeast Asia. CPA Australia advances its members' interests through education and knowledge exchange, the development of professional networks, thought leadership and the promotion of value of CPA Australia members to employers, government, regulators and the public. The CPA Australia designation denotes strategic business leadership and is recognised and valued throughout the world. More information available on www.cpaaustralia.com.au