The personal loans market has experienced rapid growth, increasing from $703.37 billion in 2023 to $776.98 billion in 2024, achieving a CAGR of 10.5%. This growth is attributed to economic stability, low-interest rates, and the trend towards debt consolidation. The market is projected to reach $1,178.65 billion by 2028 at a CAGR of 11.0%. Key drivers include the rise of fintech lenders, borrowing for educational and pandemic-related expenses, and financial inclusion initiatives. Trends to watch include digital lending platforms, alternative credit scoring, and the growth of peer-to-peer lending.
Major Driver In The Personal Loans Market
The increased demand for lending channels is expected to drive the growth of the personal loans market. This demand surge signifies a stronger need for diverse avenues facilitating individuals and businesses to access loans or credit. With the expansion of online lending platforms and fintech companies, the demand for personal loan lending channels has escalated. Personal loans offer individuals the flexibility to access funds for various personal needs without collateral, enabling them to finance expenses, consolidate debt, or address unforeseen financial challenges. For instance, in August 2022, TransUnion's Q2 2022 Credit Industry Insights Report revealed a record $192 billion in total personal loan balances, marking a 31% increase from the previous year. Hence, the heightened demand for lending channels is fostering the growth of the personal loans market. Furthermore, by 2023, the personal loans market witnessed substantial growth, reaching a valuation of $450 billion. Projections for 2028 anticipate continued expansion, with the market estimated to surpass $700 billion.
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Personal Loans Market Competitive Landscape
Wells Fargo & Company, Marcus by Goldman Sachs, American Express Company, The Goldman Sachs Group Inc., Barclays PLC, Truist Financial Corporation, DBS Bank Ltd, Discover Financial Services, Citizens Financial Group Inc., Navy Federal Credit Union, Rocket Loans, OneMain Financial, SoFi Technologies Inc., PenFed Credit Union, Social Finance Inc., LendingClub Bank, Freedom Financial Network LLC, Upstart, Payoff Inc., LendingPoint, Best Egg, FreedomPlus, Earnest, Laurel Road, Avant LLC, Prosper Funding LLC, LightStream, EarnIn, Upgrade, Universal Credit, United Services Automobile Association, PNC Financial Services Group Inc, Toronto-Dominion Bank
Key Personal Loans Market Trend
Major companies operating in the personal loans market frequently focus on technological advancements to stay competitive by adopting new technologies. For instance, in September 2022, Amplifi Capital, a UK-based fintech firm, launched the Reevo Money brand specializing in personal loans. It offers instant quotes for loans and better APRs than traditional lenders, and it uses cloud-based infrastructure and open banking to provide loans to customers with poor credit histories or irregular income. Reevo Money seeks to offer loans to consumers with a poor credit history or irregular income, as well as new borrowers or those who don't tick the conventional boxes, by utilizing a cloud-based infrastructure and open banking.
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Personal Loans Market Segmentation
The personal loans market covered in this report is segmented –
1) By Type: P2P Marketplace Lending, Balance Sheet Lending
2) By Loan Tenure: Long Term Loans, Medium Term Loans, Short Term Loans
3) By Tenure Period: Less Than 2 Years, 2 Years To 4 Years, More Than 4 Years
4) By Application: Debt Consolidation, Home Improvement, Education, Other Applications
5) By End User: Employed Individuals, Professionals, Students, Entrepreneur, Other End Users
By Geography:The regions covered in the personal loans market report are Australia, Brazil, China, France, Germany, India, Indonesia, Japan, Russia, South Korea, UK, USA, Canada, Italy, Spain.
North America was the largest region in the personal loans market in 2023.
The Personal Loans Global Market Report 2024 furnishes information about the global personal loans market, encompassing details like market size, projections for growth, segmentation across various sectors and regions, and an overview of competitors, including their revenues, profiles, and market shares. Furthermore, the report pinpoints potential opportunities and strategic directions derived from market trends and the strategies adopted by key competitors. The report also offers an assessment of how the COVID-19 pandemic, the Russia-Ukraine conflict, and increasing inflation have affected both global and regional markets, furnishing valuable strategic insights for businesses.
