2024 Marked a Recovery for European Consumer Credit

In 2024, members of Eurofinas - the federation representing European consumer credit providers, granted €484 billion in new loans, marking a 3.2% increase from the previous year. Findings from the Eurofinas 2024 Annual Survey reveal that most lending segments expanded, while industrial credit was the only segment to decline.

Overall, total new consumer credit lending grew in new business finance by 3.5% in 2024 compared with 2023. Other lending category - namely business vehicle finance, industrial credit, and mortgages - accounted for 28% of total new business, and within this segment, business vehicle finance grew by 6.9% and mortgages by 8.3%, whereas industrial credit dropped by -9.3% in terms of newly granted amounts.

In the category of consumer credit, personal loans and revolving credit stood out as the leading products, together accounting for over 42% of all new credit issued. Personal loans saw robust growth of 9.6%, revolving credit rose by 1.6%, and non-automotive point of sale financing posted a slight 0.9% increase.

In 2024, consumer vehicle finance showed stronger results for new cars than for used ones. Financing for new consumer cars increased by 2.8%, while for used consumer cars declined slightly by -0.7%.The other vehicles category, including motorbikes and caravans, recorded the largest gain, with new credit granted rising by 10.9%. A similar trend was observed in the business vehicle market. Lending for new business cars grew sharply by 11.3%, whereas for used business cars fell by -4.4%. Commercial vehicles finance also expanded with a growth of 7.4%.

In 2024, most national consumer credit markets represented by Eurofinas members reported growths in new credit granted. However, Belgium, Norway, France, Spain, and Denmark recorded declines in new credit granted, ranging from -0.5% to nearly -6% compared with 2023.

Trinh To, Advisor in Data and Statistics at Eurofinas, commented that "Consumer credit growth rebounded in 2024 compared with 2023, supported by lower interest rates, a slight tightening of financing conditions, and a gradual improvement in consumer confidence. The increase in new consumer credit was broadly observed across most national markets and product categories. Private consumption is forecast to benefit from increasing real wages and employment, alongside slightly improved access to credit, particularly for households. Nevertheless, growth in consumption is expected to remain below pre-pandemic levels as both consumers and lenders remain cautious amid persistent global uncertainties and heightened inflation risks. Overall, monetary policy remains focused on striking a balance between supporting economic recovery and maintaining price stability."