Consumer Credit in Spain

PROSPECTS

Consumer credit continues to record stable growth

The continuous improvement of the Spanish economy and decreasing unemployment levels in the last four years of the review period has led to a considerable increase in consumer credit for Spanish households.

Loans for education and vehicles will continue to increase

Loans for education is a relatively new concept in Spain, since education costs in the country are considerably low; however, with the entry of more private universities and the increase in the taxes of public ones, Spanish households will continue to seek financial support to cover education expenses. Financial institutions on the other hand, will increase their offer of new special products in educational lending, which are already offered by most Spanish banks such as BBVA and Santander.

Mortgage lending on the rise, but will remain below pre-crisis level

The strict monetary policy previously applied in Spain continued to keep the interest rates at historically low levels. Relatively low interest rates, together with greater competition among financial institutions and good economic prospects, together with high liquidity, continued to favour the increase in new mortgages/housing lending for home purchases.

COMPETITIVE LANDSCAPE

Growing competition within consumer credit

Consumer lending is usually a thermometer of the health and confidence of the economy. It has been growing uninterrupted for two years in Spain.

Easy access to small loans

Microcredits in Spain is a relatively recent concept and was created as a social project for access to credit for entrepreneurs. Towards the end of the review period, it has become a fashionable financial product and has changed its characteristics to adapt to individuals as well.

Growing digitalisation

Financial institutions continued to increase consumer lending possibilities through digitalisation. Banks invested in fast credit, such as micro credits (up to EUR3,000), which are immediate and could be taken out online through e-banking services and mobile accounts.

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