The retail credit market has been rising sharply , with strong demand for both personal loans and home loans, according to Bank Rikio , which is based on its own and central bank data.
Outstanding growth in personal loans
According to official figures, banks issued a total of $ 57.57 billion in personal loans in the first two months of the year, an increase of 72% compared to the same period of the previous year, and an increase of 1.5 times compared to the first two months of 2016.
Elina Hamson , an expert at Bank Rikio , said that borrowers use personal loans to buy durable goods, home remodeling or buying a car . In his view, demand for personal loans is due, among other things, to the rise in real net wages and low interest rates. The average market interest rate on personal loans was just over 14 percent in February, down more than 1 percentage point year on year. “Although average market rates are still above 10 percent, many banks have personal loans available at rates well below 10 percent or at full APR due to competition from customers,” the expert added. For example , according to Bank Rikio , at the beginning of April, the cheapest 1.5 million USD 5-year personal loans were available at 7-8 percent thm , under various conditions, such as a 250 thousand USD net income. However, because of competition between banks, bank offers are changing very fast , so it is worth looking around the market for a cheaper loan before borrowing.
The mortgage market is over 100 billion
According to Bank Rikio , besides personal loans, the mortgage market opened the year with a rapid growth . In the first two months of the year, banks signed new home loan agreements worth more than $ 109 billion , an increase of 38 percent compared to January-February 2017. Elina Hamson said about the trends in the housing loan market that new mortgages are dominated by schemes that guarantee a fixed installment over a number of years , thus providing predictable spending . “In the first two months of the year, the proportion of mortgage loans with a fixed installment for several years was close to 70 percent. This indicates that borrowers are striving for security, ”the expert added.
Bank Rikio experts expect that retail lending will continue to grow for the remainder of the year, and mortgage loans will play a key role in securing repayment installments for a number of years or even for the entire term.