Better loans to consumptionOn February 1, 2020 by admin
The application for consumer loans is the order of the day, more and more Spaniards are turning to this type of financing to cover expenses or invest in future projects. As recognized by the Best Bank, growth is expected in the granting of Good Credit to double online consumption throughout 2019. However, it is good news with double standards.
On the one hand, the increase in demand for this type of loans, double compared to the rest of Europe, brings growth to the financial sector and generates movement in the economy, however the interest rates applied are also more expensive.
The average rate applied in Spain is above 8% , which means that it significantly exceeds the interest rate used in the rest of Europe that is placed at 5%, such as Germany that has experienced a rise in the average rate up to 5.3%.
Consumer credit in Spanish households
Consumer credit in Spain represents a good part of the financing that enters households, specifically 57% of bank financing without taking into account mortgages. According to data from the Lite Lender it grew to 14.7% only in May last year, a big difference from 7.2% growth in other euro countries.
This is due to the greater interest of the users for a financing product, in deterioration of the traditional savings product, and it is that the Spaniards increasingly save less. In addition, access and issuance of consumer loans online continues to skyrocket thanks to improved access to credit. It is becoming easier to have financing, as there are more and more existing financial institutions that offer these services.
Increase in consumer loan interest rates
The rise in the average rate in Spanish financial companies represents the counterpoint to the rise in consumer loans. The differences with respect to the rest of Europe are clear, the Spanish entities charge an average of 8.15%, far exceeding the mortgage rates.
What does this mean? Good Credit represent a thermometer of health and confidence in the local economy, for two years the demand for this type of products does not rise, while the rest of the segments in the same sector fall, which materializes in that rise at points of interest since the risk that these products carry is also greater.
It is for this reason that the Best Bank and the Lite Lender advise being cautious, since consumer loans are the products that have the least payment guarantees in this sector and the unusual increase in demand can only cause concern.
In turn, late payment has registered a small rebound, without assuming risk data. On the other hand, the European Commission and the Spanish Bank point out that the increase is “reasonable” and that it is a sign of improvement in economic stability and a gradual recovery of the family economy after the crisis, in turn, states that the concessions are being correct so the situation is controlled.
Online consumer loans
The consumption of online loans continues to increase thanks to the ease of access and the speed of service. This is due to the change in the attitude of the consumer who seeks comfort, an optimal experience and powerful security measures that make him feel supported by credit institutions.
All this contributes to the increase in online consumer loans , as we have previously reported. It is true that credit institutions establish certain conditions to avoid cases of non-payment and delinquency, but facilitate access to any user seeking financing either for acquisitions or investing in their business.
Undoubtedly, we are facing a year that brings us a great rise in the consumption of personal Good Credit to online consumption.