UK Personal Lending 2010: Competitive Dynamics in the UK Unsecured Lending Market
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Introduction
Competition in the unsecured personal loan market remained flat in 2009 as lenders cautiously focused their attention on selling to existing customers. There were minor competitive developments but the overriding focus of lenders was ensuring that bad debt levels remained under control. In addition, preparation for the implementation of new regulatory measures remains an ongoing concern.
Scope
- Provides market share data for gross advances and balances outstanding for the largest UK personal loan providers.
- Analyzes developments in the channels used to arrange a loan and considers different lender profiles in terms of borrower loan size and term.
- Includes data on advertising expenditure such as how much providers are willing to spend to promote their products and via which channels.
UK Personal Lending 2010: Competitive Dynamics in the UK Unsecured Lending Market
Highlights
Under an uncertain economic outlook, lenders have continued to focus on their core business. There is a need to find business where they can write a good margin yet avoid taking on potential bad debt. On the demand side, concern about the future is leading borrowers to postpone purchases, while on the supply side there is a liquidity drive.
The overall level of advertising expenditure on unsecured personal loans has decreased over the last couple of years, which is consistent with the overall decrease in the level of competition from lenders pulling out and restricting lending. Advertising expenditure for unsecured personal loans has declined from £51.6m in 2007 to £18.9m in 2009.
Borrowers with RBS tend to take out larger loans and for a longer period of time. In general the biggest players in the market have a greater proportion of large loans in their portfolio whereas the smaller lenders have a larger proportion of smaller loans and a larger share of short term loans.
Reasons to Purchase
- Gain an understanding of the performance of your competitors.
- Comprehend how conditions in the market are developing and what opportunities might present themselves as a result.
- Understand how the latest regulatory developments will impact on your business.
