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Banks and credit unions lose scale on loans as fintechs grow.
New research from Mercator Advisory Group explores current trends and opportunities in installment lending for fintechs and financial institutions.
Published on: March 14, 2022 Author: Brian Riley Alternate Point of Contact: Amy Dunckelmann
Mercator Advisory Group released a report on trends in installment lending titled Installment Lending: Fintechs Gaining Ground on Loans Forecast at $212 Billion. The research explains the state of consumer installment lending in the United States and how fintechs and finance companies now outpace banks and credit unions in installment loans. Furthermore, this research examines how companies are offering embedded finance products such as CCaaS to allow customers the ability to offer their own credit card product. By way of four evaluative criteria, general advice is provided for those seeking a relationship with a fintech provider.
“Banks used to dominate consumer lending, with installment lending products priced far lower than credit cards, but that is no longer the case,” comments Brian Riley, Director of the Credit practice at Mercator Advisory Group, and the author of the research report. “Buy Now, Pay Later (BNPL) was a wake-up call to credit card issuers. BNPL was a recast of a merchant finance model used long ago by companies like GECC (now Synchrony) and Household Finance Corporation (acquired by Capital One). Now, fintechs are moving in the same direction with installment loans,” Riley says.
This document contains 28 pages and 9 exhibits.
Companies mentioned in this research note include: Acima Credit, Affirm, American Express, Avant, Bankrate, Blend Labs, Bread, Capital One, Citi, Discover, Equifax, Experian, FIS Global, FICO, Fiserv, GECC, HFC, JPMorgan Chase, Jack Henry, Klarna, Lending Club, LightStream, Mastercard, NerdWallet, Opportun, Prosper, Regions Bank, Rocket Companies, SoFi, Synchrony, TSYS, Truist, TransUnion, Upgrade, Upstart, Visa, Wells Fargo, Worldpay, Zopa
Highlights of this document include:
Commercial & Enterprise Payments
Debit & Alternative Products
North American PaymentsInsights
Small Business PaymentsInsights
Fraud Experience PaymentsInsights
News & Events
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