Consumer credit (the funds an individual borrows for personal, family or household purchases) is expected to be bolstered by the strong economy, including low unemployment rates and wage growth, as well as increases in gross domestic product and the slowed growth of home prices.
Here are some expected trends to keep in mind for 2018:
Consumer experience is critical. Recent research from Fiserv found the majority of loan seekers select their lender based on past experiences, with more than half taking into account the customer service a prospective lender offers. In today’s digitally driven world, balancing the need for technology with providing a positive, seamless experience aided by knowledgeable staff will be key.
Point-of-sale lending will give credit cards a run for their money. Credit cards will continue to reign king, but point-of-sale loans offered at the checkout will increase in popularity for the purchase of everything from clothing to travel, especially for younger consumers. According to American Banker, this trend is reflective of consumer demand for more options as well as holdover discomfort with credit cards following the 2008 financial crisis.
In response to this, advances in technology make it possible for borrowers to secure credit on the spot (and adding a new line of revenue for the businesses that make this option available).
Lending joins the digital age. We’ve long been able to view our account balance and make transfers online (and even deposit checks via mobile), but the ability to secure end-to-end loans has lagged. This will change in 2018, as many work toward creating a simplified consumer experience. As mentioned here already, personal interactions with knowledgeable staff will still have an important place, but in today’s digital world, lenders will be able to deliver on consumers’ demand for “human touch” through methods like co-browsing tools and video chat.
With the consumer in mind and an eye on technology, 2018 could be the best year yet to dip into the consumer lending space. Beginning with our 2016 acquisition of Specialty Consumer Services,consumer lending is a key area where MetaBank has invested in personnel and technology to enrich our market offerings.
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