Wednesday, December 11, 2019

Worldwide study: Consumer loans grow double-digit in emerging markets – Developed countries fall behind

Global per capita debt increased by 4.7% in 2012 compared to the previous year and stood at 910 euros at the end of the year. Here, however, there are strong regional differences, which result in particular from the population density and the economic power: While the average consumer credit burden in Africa is 96 euros, a North American pays back on average more than 5,600 euros. For comparison: The Germans occupy the midfield with receivables amounting to 2,741 euros per capita. The highest is the personal accounts receivable with 11.677 euro loan amount per capita in Canada.

The global consumer credit market continues to be dominated by North America: with a grand total of 2.162 billion euros, the US leads by far the highest credit outstandings ranking, followed by Japan (714 billion), China (433 billion) and Canada (401 billion). Germany ranks sixth with 225 billion euros between Great Britain and Brazil. “The German consumer credit market has been developing at a stable level for several years. The installment loan contained therein is by far the dominant product. As of the end of June 2013, installment loan portfolios grew by 1 percent to 147.8 billion euros, “says John K. Ortiz, CEO of our bank.

Demand is rising, especially in emerging markets

Despite generally weaker economic growth in 2012, emerging markets are showing remarkable developments: In Russia, consumer credit grew by 43 percent over the previous year, in Argentina by 35 percent and in Thailand and Azerbaijan by 32 percent each. However, the increase in Argentina is at least partly a consequence of continued inflation. In China, there was at least a growth of 18 percent in 2012. In South America’s largest market, Brazil, growth slowed slightly in 2012, as did Latin America (21.6 percent to 13.5 percent).

However, growth in Latin America is still high compared to developed countries. By contrast, North America and Europe only grew by 5.5 and 2.6 percent, respectively. If the emerging markets of Russia and Turkey did not influence the European value, there would be no growth at -1.7 percent, but a decline. The EU alone comes to a value of -1,9.

Magic limit: From 2,500 euros gross domestic product per capita, the consumer credit market is growing disproportionately

“Economic growth contributes significantly to the strengthening of the consumer credit market,” says CEO John K. Ortiz. “For emerging markets, it is clear that as soon as gross domestic product per capita reaches the” magic limit “of 2,500 euros, the consumption finance market will develop disproportionately – and the country will be heading for economic stability.”

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