Annual 2020 survey results for consumer credit

The European consumer credit industry was not exempt from the general downturn experienced as a result of the Covid-19 pandemic in 2020.

European consumer credit providers, represented through Eurofinas, granted new loans worth €400.6 billion in 2020, a decrease of -13.1% compared to 2019. The results of the Eurofinas 2020 Annual Survey show declines in new business across all lending categories. Total new consumer credit lending showed losses in new business financed of -15.4% in 2020. Both industrial credit and mortgages contribute a smaller share of total new business, with both undergoing a decrease of -11.5% and 4.2% respectively.

In the consumer credit lending category, personal loans represented over a quarter of new credit granted in 2020, while revolving credit accounted for around a third. Personal loans and revolving credit shrank by -20.2% and -17.4% respectively. To a lesser extent, new credit granted via non-automotive point of sale was down by -7.4%.

Consumer vehicle finance also experienced declines in new credit granted, with new cars performing worse than used cars. While the former dropped by -16.4%, the latter showed a loss of -8.3%. The other vehicle category (motorbikes, caravans etc.) contracted by -7.2%. In contrast to the consumer car financing business, new business cars lending dropped by -5.9% but a higher decrease of -7.9% for used business cars. Commercial vehicles were the worst performer in the vehicle finance category, which showed negative growth of -19.9%.

Aggregate figures for 2020 showed that most of Eurofinas members’ national markets saw large deteriorating results, except for Turkey, Germany and the Nordic countries. Turkey was the only country indicating growth in new lending volumes in 2020, as they increased from low levels of previous years. Germany and the Nordic countries recorded relatively moderate single-digit declines in 2020 compared to 2019. By contrast, the biggest losses were felt in Morocco, Spain, and Lithuania, with new credit granted falling by over -20%.

Anne Valette, Director General, Eurofinas

“Consumer credit growth has deteriorated in 2020 due to the global impact of Covid-19 on social and economic activities. A downturn in new credit granted was widespread across national markets and lending types. Despite that, the consumer credit industry showed remarkable resilience in supporting customers to access finance crucial for European economic recovery. As restrictions are eased, vaccination programs progress across Europe and consumer confidence rebounds, private consumption is expected to drive European economic recovery going forward. This presents opportunities for European consumer credit institutions to supporting much needed consumer financing and facilitate economic recovery.”