Over 2022, consumer credit gross lending is set to continue its recovery from the strong decline in current value terms recorded in 2020 in the wake of the Coronavirus (COVID-19) public health crisis in Malaysia. A strong rebound in 2021 took consumer credit gross lending above its 2019 level, with a projected double-digit increase over 2022 set to consolidate the improvement in consumer lending in Malaysia.
Malaysia Bank Negara (Central Bank of Malaysia) revised its Overnight Policy Rate (OPR) upwards twice in the second half of 2022, in July and September. These OPR revisions had a dampening effect on the potential take up of consumer lending products in Malaysia by increasing borrowing rates and making it more costly to take out loans.
In 2021, mortgages/housing gross lending rebounded strongly from the 2020 slump caused by the COVID-19 pandemic. Thus, the category had exceeded its pre-pandemic (2019) level in current value terms by the end of 2021.
Buy Now Pay Later (BNPL) has emerged quickly as a key competitor to consumer credit in Malaysia. The fast-growing array of Buy Now Pay Later (BNPL) players and facilities threatens to significantly hamper the growth potential of personal loans.
From 2022, inflation is expected to remain relatively high in Malaysia, compared with 2018-2021. The higher cost of living, including rising food and energy prices, are likely to dampen household budgets, and see some consumers defer the taking out of consumer credit loans.
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Understand the latest market trends and future growth opportunities for the Consumer Lending industry in Malaysia with research from Euromonitor International's team of in-country analysts – experts by industry and geographic specialisation.
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Aggregate of Consumer Credit and Mortgages/Housing. Gross Lending: The total value of loans advanced by institutions in a given year; data refers to single year only. Outstanding Balance: The collective amount owed by borrowers at the end of a given year; data refers to the cumulative impact of debt.See All of Our Definitions
This report originates from Passport, our Consumer Lending research and analysis database.
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