U.S. consumer installment loan market: FinTechs and finance companies outperform banks and credit unions in installment loans

ByRichard C. Sloan

Mar 23, 2022

Dublin, March 23, 2022 (GLOBE NEWSWIRE) — The report “Installment Loans: Fintechs Gaining Ground on Loan Forecast at $212 Billion” has been added to from ResearchAndMarkets.com offer.

The report explains the state of consumer installment loans in the United States and how fintechs and financial companies are now overtaking banks and credit unions when it comes to installment loans. Additionally, the research examines how companies are offering integrated financial products such as CCaaS to enable customers to offer their own credit card product. Using four assessment criteria, general guidance is provided for those seeking a relationship with a fintech provider.

“Banks used to dominate consumer lending, with installment loan products priced far below credit cards, but that’s no longer the case,” said Brian Riley, author of the research report. “Buy Now, Pay Later (BNPL) was a wake-up call for credit card issuers. BNPL was a revamp of a merchant funding model used long ago by companies like GECC (now Synchrony) and Household Finance Corporation (acquired by Capital One) Now fintechs are moving in the same direction with installment loans,” Riley says.

Highlights of the research note include:

  • Consumer Debt Trends in the United States
  • Trends in Fintech and Financial Companies vs. Financial Institutions
  • Why banks and credit unions should define the consumer lending space, not follow fintech trends
  • Strengths, Weaknesses, Opportunities and Threats for Established Banks and Fintechs
  • Comparison of revolving and installment loan products
  • Consumer survey data on installment loan users and top fintech lenders

Main topics covered:

  • Abstract
  • US household debt
  • Unsecured Installment Loans: Defining the Space
  • Reasons why consumers choose non-traditional lenders
  • Installment Loans: Risks and Opportunities for Financial Institutions and Fintechs
  • What financial institutions should do
  • What Fintechs and Traders Should Do

Figures and tables

  • Figure 1: US consumer debt is $15.6 trillion across all collateral categories
  • Figure 2: Unsecured personal loans in the United States will reach $212 billion by 2025
  • Figure 3: Fintechs and financial companies overtook banks and credit unions in terms of market share between 2016 and 2021
  • Figure 4: Range of consumer credit products
  • from unsecured revolving and installment loans to secured loans
  • Figure 5: Nearly a quarter of cardholders surveyed said they use an online lender
  • Figure 6: Top seven drivers of installment borrowing by credit card consumers

Companies cited

  • Credit Acima
  • To assert
  • American Express
  • Before
  • The bank rate
  • Mixing laboratories
  • Bread
  • Capital one
  • Town
  • Discover
  • Equifax
  • Experian
  • World FIS
  • FICO
  • Fiserv
  • GECC
  • HFCs
  • JPMorgan Chase
  • Jack Henry
  • Klarna
  • loan club
  • LightStream
  • MasterCard
  • NerdWallet
  • Opportunity
  • Prosper
  • Bank of Regions
  • Rocket companies
  • SoFi
  • Synchrony
  • TSYS
  • Truist
  • Trans Union
  • To improve
  • Reached
  • Visa
  • Wells Fargo
  • worldpay
  • Zopa

For more information about this report visit https://www.researchandmarkets.com/r/1sqa5l

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