Consumer credit: start of the year in calm waters

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After a year 2018 which saw the production of consumer credits jump by 5%, the beginning of 2019 has had less spectacular beginnings: -0.2% according to figures from the French Association of Financial Companies. Following on from the last quarter of 2018, which is already losing momentum.

The fall in revolving credit

The fall in revolving credit

Purchasing power was at the heart of the Great National Debate and consumer credit represents a form of extension of a household’s ability to finance its projects. It is clear that it slightly decreased in volume last January as indicated in the monthly publication of the ASF, which noted less than 3.2 billion US dollars borrowed, or 7 million US dollars per month qu ‘at the same time the previous year. This slight decline affects more traditional consumer loans (-0.5%) than rental operations with purchase option (+ 1.4%). Personal loans (-3.8%) and revolving loans (-3.5%) saw the largest drop, while car credit (-0.4%) continued to lose ground over the LOA for the purchase of a new vehicle (+ 0.6%).

Opportunity is on the rise

Opportunity is on the rise

What is still striking in January 2019 on the consumer credit front is the sharp increase in financing for used vehicles . In 2018, used car credit had increased by 9.4% and used LOA by 38.1%; we start on the same basis at the start of the year with an advance of + 10.6% for the first and + 30.6% for the second! In total, this represents 366 million US dollars in one month (+ 12.6%), more than half the amount borrowed for a new purchase (673M €, + 0.6%).

These earmarked credits that resist the LOA

These earmarked credits that resist the LOA

Among the other ASF indicators for January 2019, we can see the good health of consumer credit allocated to improving the home and household goods (+ 9.6%). This concerns purchases of household appliances, furniture or multimedia equipment. If we consider the financing of vehicles other than cars, the volume of consumer loans also increased (+ 4.1%), while conversely the LOA excluding cars fell (-19.5% ).

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