Table of Contents
Introduction and Abbreviations
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- Introduction
- Other relevant reports
- Definitions and scope of the report
- Abbreviations and terms
- Abbreviations
- Terms
Executive Summary
Market Drivers
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- Consumers’ lack of extra cash drives the need for more
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- Figure 1: Percentage of worldwide consumers with “No Spare Cash,” May 2005
- Figure 2: U.S. personal saving rate as a percentage of disposable personal income, 1980-Q3 2005
- Consumers’ lending options increase, compete with unsecured loan offers
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- Figure 3: Estimated mail volume of U.S. loan acquisition and follow-up acquisition solicitation of all types other than credit cards, Q1 2003-Q3 2005
- Credit cards
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- Figure 4: Estimated mail volume of U.S. credit card acquisition and follow-up acqusition solicitation, Q1 2003-Q3 2005
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- Figure 5: Percentage of credit card solicitations with balance transfer offers, 2003-05
- Home equity
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- Figure 6: Home ownership rates, Q2 2005 vs. Q2 2004
- Payday lenders fill the space with quick cash for consumers
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- Figure 7: Average payday loan APRs by state regulatory environment, 2001
- Increasing convenience impacts the usage rates of consumers
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- Figure 8: Top twenty U.S. bank holding companies by number of branches, November 2004
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- Figure 9: Locations of major payday lenders, 2005
- Credit unions’ increased accessibility and low rates are making them more competitive
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- Figure 10: Personal loan rates by banks and credit unions, 2000-05
- Interest rates are poised for an increase, meaning more debt service
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- Figure 11: Personal interest payments and U.S. prime rate, 1999-2005
- The need for debt consolidation could rise
- New bankruptcy laws will make it harder for borrowers to default
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- Figure 12: Non-business bankruptcy filings, 1995-2004
- The health insurance gap
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- Figure 13: Uninsured Americans by family income, 2003 and 2004
Market Size and Trends
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- Overall consumer borrowing
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- Figure 14: Total U.S. Consumer non-real-estate loans outstanding, revolving vs nonrevolving, 2000-05
- Estimated market size for unsecured loans
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- Figure 15: Distribution of the debt of homeowners and renters, by loan type, 1990-2002
- Figure 16: Dollars outstanding in personal unsecured nonrevolving loans, 2000-05
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- Figure 17: Total personal unsecured closed-end loan assets outstanding from all sources, 2000–05
Market Segmentation
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- Income and wealth
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- Figure 18: Percentage of U.S. households carrying debt, by household income percentile, 1998 and 2001
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- Figure 19: Median debt of U.S. households carrying debt, by household income percentile, 1998 and 2001
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- Figure 20: Percentage of U.S. households carrying debt, by net worth percentile, 1998 and 2001
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- Figure 21: Median debt of U.S. households carrying debt, by net worth percentile, 1998 and 2001
- Age
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- Figure 22: Percentage of U.S. households carrying debt, by age of head of household, 1998 and 2001
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- Figure 23: Median debt of U.S. households carrying debt, by age of head of household, 1998 and 2001
- Work status
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- Figure 24: Percentage of U.S. households carrying debt, by work status of head of household, 1998 and 2001
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- Figure 25: Median debt of U.S. households carrying debt, by work status of head of household, 1998 and 2001
Competitive Landscape
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- Overview
- Holdings of non-mortgage debt, by type of organization
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- Figure 26: non-mortgage debt, credit outstanding by type of financial organization holding, 2003
- Full Service Banks
- Major banks, unsecured loan holdings
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- Figure 27: Major banks, consumer unsecured loans outstanding at year end, 2002-04
- Figure 28: Unsecured loan products of major banks, 2005
- Major Bank Profiles
- Bank of America
- Citigroup
- HSBC
- Wells Fargo
- Credit Unions
- Overview
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- Figure 29: Number of credit unions and number of credit union members in U.S., 1999-2004
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- Figure 30: Personal unsecured loans outstanding at credit unions that are CUNA members, 1995-2004
- Figure 31: Unsecured loan products of major credit unions, 2005
- Top Credit Unions
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- Figure 32: Top 10 U.S. credit unions by number of members, 2004
- Select Credit Union Profiles
- Navy Federal Credit Union
- BECU
- Payday Lenders
- Overview
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- Figure 33: Snapshot of major U.S. payday lenders, 2005
- Select profiles of payday lenders
- ACE Cash Express, Inc.
- Advance America
- Other Lenders
- American General Financial Services
- Capital One
Advertising and Promotion
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- Overview
- Overall marketing spending
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- Figure 34: Top ten financial services companies by estimated advertising expenditures, 2003-04
- Direct mail
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- Figure 35: Unsecured loans estimated mail volume, January 2004-March 2005
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- Figure 36: Top unsecured loan mailers, 2004-2005
- Online
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- Figure 37: Online advertising spending by selected financial services companies, 2004
- Individual companies
- Advance America
- Bank of America
- Capital One
- Citigroup
- HSBC
- Wells Fargo
The Consumer
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- Introduction
- Ownership of unsecured loans and related products
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- Figure 38: Received a personal loan or payday loan in the past year, October 2005
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- Figure 39: Number of credit cards held, October 2005
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- Figure 40: Number of credit cards held, by age, October 2005
- Motivation to get a personal loan
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- Figure 41: Circumstances to consider a personal loan, by age, October 2005
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- Figure 42: Concern about having enough cash to pay expenses, by household income, October 2005
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- Figure 43: Concern about having enough cash to pay expenses, by marital status and household size, October 2005
- Choosing an unsecured loan
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- Figure 44: Importance of unsecured loan attributes, including loan attributes that are currently offered with credit cards, October 2005
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- Figure 45: Graph: Mean importance of unsecured loan attributes, by age of respondent, October 2005
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- Figure 46: Mean importance of unsecured loan attributes, by household income, October 2005
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- Figure 47: Mean importance of unsecured loan attributes, by education level of respondent, October 2005
- Summary
Future and Forecast
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- Future trends
- Lending with a purpose
- Rewarding options
- Payday loans are here to stay
- Intergenerational lending
- Home equity lending will continue to grow at the expense of personal loans
- Private educational lending also on the rise
- Market forecast
- Overview
- Methodology
- Personal unsecured closed-end loan assets outstanding from all sources
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- Figure 48: Forecast of total U.S. personal unsecured closed-end loan assets outstanding from all sources, at current and constant prices, 2005-10
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- Figure 49: Graph - Forecast of estimated total U.S. unsecured, nonrevolving personal loans at current prices, 2000-10
- Figure 50: Forecast of total U.S. revolving non-real estate debt, 2000-08
- Figure 51: Forecast of total U.S. nonrevolving non-real estate debt
- Figure 52: U.S. consumer non-real estate loans outstanding, 2000-08
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- Figure 53: Percentage change of U.S. consumer non-real estate loans outstanding, 2000-04
Appendix: Trade Associations
Appendix: Direct Mail Advertising
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- Figure 54: Advance America payday advance direct mail advertisement, November 2005
- Figure 55: Advance America payday advance direct mail advertisement, November 2005
- Figure 56: CapitalOne personal loan direct mail advertisement, November 2005
- Figure 57: Citibank personal loan direct mail advertisement, November 2005
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- Figure 58: HSBC personal loan direct mail advertisement, November 2005
- Figure 59: Wells Fargo personal loan direct mail advertisement, November 2005
- Figure 60: Financial 21Community Credit Union personal loan direct mail advertisement, November 2005
- Figure 61: Keesler Federal Credit Union personal loan direct mail advertisement, November 2005
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- Figure 62: Nevada Federal Credit Union payday loan direct mail advertisement, November 2005
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