Consumer Lending Industry Profile

Report Page Length: 10-12
Last Quarterly Update: 7/3/2017
SIC Codes: 6141
NAICS Codes: 522291
Chapters Include:
Industry Overview Trends & Challenges Industry Forecast
Quarterly Industry Update Call Prep Questions Website & Media Links
Business Challenges Financial Information Glossary & Acronyms
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Excerpt from Consumer Lending Industry Profile

Companies in this industry make unsecured cash loans to consumers. Major companies include US-based DFC Global, EZCORP, First Cash Pawn (formerly Cash America), OneMain Holdings, and SLM (better known as Sallie Mae), along with Provident Financial and Tesco Personal Finance (both based in the UK) and Orient Corporation (Japan).

Worldwide, the value of consumer lending balances outstanding at the end of 2015 was $42.3 trillion, up from $37.1 trillion in 2011, according to CPI Financial. Consumer lending companies generally do business locally or within their country of origin, but globalization and greater access to the internet are spurring companies to pursue international growth.

The US consumer lending industry consists of about 13,000 establishments (single-location companies and units of multi-location companies) with combined annual revenue of about $35 billion.

COMPETITIVE LANDSCAPE

Demand is driven by consumer income and demographics. The profitability of individual companies depends on the correct assessment of repayment likelihood and effective collections activities. Large companies enjoy economies of scale in securing access to capital. Small companies can compete effectively by choosing favorable locations or targeting niche markets. The US industry is highly concentrated: the 50 largest companies account for about 85% of revenue.

The federal financial reform law passed in 2010 created a tougher business environment for consumer finance firms. The regulations restrict credit cards companies from imposing interest rate hikes and fees, limiting payday loans, and discouraging auto title loans. The ...

 
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