Despite a complicated year-end in 2018, the consumer credit market has been picking up steam since February 2019. The French Association of Financial Companies (ASF) recorded a + 3.6% increase compared to February 2018. This resumption of growth comes to revitalize a market down -4.6% in December 2018 and -0.2% in January 2019, which is mainly due to the crisis of yellow vests.
What is consumer credit?
Consumer credit is a financing solution offered by lending institutions that consists of advancing the funds needed to carry out the client’s project. These funds are then repayable according to predefined conditions in the loan offer. The credit conso allows to acquire a movable property (car or other), but also to realize a single project such as a trip, a marriage, etc.
The consumption credit is divided into two main families: the appropriations allocated and the unrestricted credits. The appropriations allocated are intended for a specific purchase (a movable property or a service). The unallocated credit is usable for any type of project and can even act as cash.
Consumer credit carried by automobile and equipment
The French Association of Financial Companies (ASF) studies the habits of French households in order to understand the evolution of the consumer credit market.
Used cars attract more and more households, + 19.2% compared to February 2018 and an average increase of + 7.6% over the last three months. This increase recorded in February is driven by the appropriations allocated, which amounted to 15.1% and the Lease with Purchase Option (LOA) transactions which reached + 62.3%. As for new cars and after two difficult months (December and January), an increase of + 6.2% in February 2019, is recorded compared to the same month of the previous year.
Regarding the financing allocated to improving the home and equipment of the household, the ASF notes an increase of + 15.8% compared to February 2018 and + 8.5% over the months December, January and February.
Revolving credits and declining single loans
After a sharp decline in December 2018 of -5.8% and -3.5% in January 2019, the decline in the number of revolving loans subscribed was reduced in February 2019 to -1.4%. Production of revolving loans contracted by an average of -3.7% in December, January and February.
single loans declined by -2.3% in February 2019, after -3.8% in January 2019 and -6.3% in December 2018.