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Although many people postpone major purchases, parties or vacations during the crisis, the loan amount for consumer goods or a vehicle is increasing. According to a recent study, consumers particularly like to finance with installment loans.
German consumers are increasingly making the purchase of kitchens, expensive furniture or cars dependent on appropriate financing.
Springer Fachverlag Wiesbaden GmbH
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Consumers would not make two thirds of all retail financed purchases without payment in installments. Ten years ago this proportion was still half. Overall, around every third household in Germany currently finances consumer goods. This is the result of a current market study on consumer and vehicle financing by the opinion research institute Ipsos on behalf of the banking association. For this purpose, almost 2,000 people between the ages of 18 and 69 were surveyed in a representative manner in July 2020.
Installment loans are particularly popular with car buyers
“The importance of alternative payment options has increased significantly,” explains association manager Jens Loa. More than 70 percent of financing users even actively asked for installment payments. This applies above all to vehicles. Installment loans make up 30 percent of used vehicles and 29 percent of new vehicles. Only then do furniture and kitchens follow with 15 percent, entertainment electronics with 13 percent and large household appliances with eleven percent.
The study puts the average financing amount at 11,300 euros of used financing. In 2019 it was 10,600 euros. Above all, the number of loans up to 5,000 euros rose by three to 40 percent. Even with sums between 10,000 and 15,000, the survey found an increase from 14 to 16 percent compared to the previous year. On average, consumers pay back around 310 euros a month to the lender. In 2019 it was 300 and in 2018 only 290 euros a month.
However, the total number of loans used per household fell slightly compared to the previous year’s study to the mean value of 2.1 (2019: 2.2). The number of five or more parallel financings has also decreased slightly from ten percent in 2019 to currently eight percent. Around 22 percent of those surveyed have two current loans (2019: 21 percent). The numbers for three and four parallel financings stagnate at 13 and six percent, respectively.
More and more loans are taken out online
The Germans use the internet application processes more and more, especially for installment loans. Around four percent of the contracts are now made entirely online. The conclusion then takes place via remote identification and electronic signature. In 2019, that was the case for only one percent of installment financing.
Overall, however, 44 percent of consumers still rely on advice in the bank branch when it comes to financing, even if the figures here have declined overall in recent years (2019: 44 percent, 2018: 46 percent, 2017: 47 percent, 2016: 52 Percent). Currently, 26 percent of consumers (2019: 24 percent) rely on information from the banks’ websites and 25 percent of those seeking advice (2019: 19 percent) on online comparison portals.
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