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- All Industries /
- Finance /
- Financial Services /
- Loans and Borrowing /
- US Personal Lending Market Report 2024
Personal lenders must adapt to meet the changing preferences of borrowers while navigating an increasingly competitive landscape.
Amr Hamdi, Finance Analyst
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Executive Summary
- What you need to know
- Consumer trends: key takeaways
- Credit unions have an opportunity to convert interest into acquisition among Hispanic consumers
- Graph 1: types of personal lenders Hispanic consumers use, 2024
- Hispanic adults are most interested in taking out a personal loan from credit unions and online-only banks
- Financially healthy consumers are more aspirational in their personal loan usage
- Graph 2: reasons for opening a personal loan, by financial situation, 2024
- Millennials are driven by convenience-based factors when choosing a lender
- Graph 3: top factors when choosing a personal loan – NET – any rank , by generation, 2024
- Market predictions
- Opportunities
- Financial relief offerings can lend a helping hand to struggling customers grappling with the high-rate environment
- Refer-a-friend offers can be a successful acquisition tool given younger consumers' social preferences
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Market Dynamics
- Market context
- Market drivers
- Rate cuts could stimulate personal loan demand
- Personal lenders could be braced for a busy summer
- Market landscape
- Total household debt rose to $17.5 trillion in Q4 2023 – a 3.6% year-over-year increase
- Graph 4: total loan debt, by type, 2019-23
- Credit cards continue to lead in account openings
- Graph 5: number of loan accounts, by type, 2019-23
- Auto loan and credit card delinquencies are on the rise
- Graph 6: percent of balance 90+ days delinquent on loans, by type, 2019-23
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Consumer Insights
- Consumer fast facts
- Personal loan ownership and interest
- Consumers have steadily accumulated more debt since 2022
- Graph 7: types of debt owned, 2022 and 2024
- Banks have captured the lion's share of the rise in personal loan ownership in the past two years
- Graph 8: types of personal lenders used over time, 2022 and 2024
- Hispanic and Black adults have the highest share of personal loan debt
- Graph 9: types of debt owned, by race and ethnicity, 2024
- How lenders can enhance the financial literacy of multicultural consumers
- Reasons for opening a personal loan
- Paying off debt and basic expenses are the two biggest reasons for opening a personal loan
- Graph 10: reasons for opening a personal loan, 2024
- Multicultural consumers are most likely to open a personal loan for debt consolidation and covering basic expenses
- Graph 11: reasons for opening a personal loan, 2024
- Personal loan plans
- Over half of Millennials foresee themselves applying for a personal loan within the coming year
- Graph 12: % of consumers that plan on applying for a personal within the next 12 months, by generation, 2024
- Differing levels of planning confidence from varying income brackets present opportunities for tailored messaging
- Graph 13: % of consumers that plan on applying for a personal within the next 12 months, by household income, 2024
- Factors when choosing a personal loan
- Price remains most important when seeking a personal loan
- Graph 14: top factors when choosing a personal loan, 2024
- Younger adults lean harder on family/friend testimonials when seeking a lender
- Graph 15: top factors when choosing a personal loan – NET – any rank, by age, 2024
- Personal loan behaviors and attitudes
- More consumers are weighing up their options before deciding on a personal lender
- Graph 16: personal loan behaviors over time, 2022 and 2024
- There is a growing preference of branch-based engagement during the lending journey
- Graph 17: personal loan behaviors over time, 2022 and 2024
- Nearly a third of financially struggling consumers have trouble making on-time loan payments
- Graph 18: personal loan behaviors, by financial situation, 2024
- Parents are much more likely to have trouble paying off their personal loans
- Graph 19: personal loan behaviors, by parental status, 2024
- Seven in 10 Millennials would refinance their debt if the rate was appealing enough
- Graph 20: refinancing attitudes, by generation, 2024
- There is a significant opportunity for fintechs to penetrate the multicultural market
- Graph 21: openness to non-traditional lenders, by race and ethnicity, 2024
- The majority of consumers would prefer to take out a loan with their primary bank, but the importance of low rates is ultimately too great
- Graph 22: attitudes towards lenders, by generation, 2024
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Innovation and Marketing Trends
- Marketing and advertising
- Discover highlights how its personal loans can make debt a thing of the past
- SoFi stresses its cost-effective personal loans for those with a penchant for home improvements
- Millennials lead in personal loan usage via traditional banks
- Graph 23: types of personal lenders used, by generation, 2024
- Citi flexed its brand equity as one of the reasons prospects should selected them for a personal loan
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Appendix
- Consumer research methodology
- Generations
- Abbreviations and terms
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