TransUnion report finds personal loans continued to grow in popularity; Baby boomers make up largest share of consumers with a personal loan in 2016
Auto loans, credit cards and personal loans reached new milestones in 2016 as the number of consumers with access to these products continued to grow, according to TransUnion’s (NYSE:TRU) Q4 2016 Industry Insights Report
. The report, powered by PramaSM
analytics, found that balances rose across all credit products by year-end.
“The consumer credit market performed well at the end of 2016. Total balances rose across every credit product in the fourth quarter following a strong shopping season. For the past several years, auto lenders have been responding to the pent-up demand in the subprime risk tier, and card issuers have been competing for share of wallet. Lenders are issuing more credit, and consumers are using that credit. As a result of this conscious effort to relax underwriting, we have observed higher, although still well controlled, credit card and auto delinquency rates over time.”
Nidhi Verma, senior director of research and consulting in TransUnion’s financial services business unit
Personal loans reached a new milestone at the conclusion of 2016, with total balances topping $100 billion for the first time ever. While younger consumers have played a major role in the growth of these lending products, TransUnion’s Q4 2016 Industry Insights Reportconfirmed that, contrary to popular belief, mature borrowers are leading the charge on these loans. “Personal loans continued to grow in originations and balances, and we expect this to remain a popular product for all consumers in 2017,” added Verma.
Baby boomers comprised 32.8% of all consumers with a personal loan at year-end 2016, followed by Gen X (31.6%) and millennials (26.6%). In Q4 2013, millennials comprised just 23.5% of personal loan users, but their share grew over the past three years to reach 26.6% at the end of 2016.
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