Table of Contents
Introduction
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- Definition
- Methodology
- Abbreviations
Executive Summary
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- Trends in Lending
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- Figure 1: Loans to households, China 2008-April 2014
- Figure 2: Share of total loans to households by loan type and growth rates, China 2008-13
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- Figure 3: Projected share of different types of loans in household lending, China 2013 versus 2020
- The Consumer
- Usage of credit and loan products
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- Figure 4: Usage of credit cards, loans or other credit products, April 2014
- Reasons for not using loans or credit products
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- Figure 5: Reasons for not using loans or credit products, April 2014
- Purpose of using loans
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- Figure 6: Current purpose of using loans and potential interest over the next 2-3 years, April 2014
- Motivating factors for using loans
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- Figure 7: Factors that encourage consumers to use loan products to cover household expenditure, April 2014
- Credit card usage habits
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- Figure 8: Credit card usage habits, April 2014
- Attitudes towards credit and loans
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- Figure 9: Consumer attitudes towards borrowing and debt, April 2014
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- Figure 10: Consumer attitudes towards loans, April 2014
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- Figure 11: Consumer attitudes towards credit cards, April 2014
- Consumer segmentation
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- Figure 12: Consumer segmentation, April 2014
- Key issues
- What drives people’s openness to borrowing?
- What are the opportunities to grow consumption loans?
- How to market loan products to young adults?
- What innovations can encourage people to use more loans and credit products?
- What we think
Issues and Insights
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- What drives people’s openness to borrowing?
- The facts
- The implications
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- Figure 13: Agreement with “I am worried about relying too much on purchasing on credit”, by age, April 2014
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- Figure 14: Agreement with “Borrowing money is acceptable as long as you can repay it on time”, by education, income and age, April 2014
- Figure 15: Agreement with “It is better to spend only what you can afford rather than taking out an overdraft”, by education, income and age, April 2014
- What are the opportunities to grow consumption loans?
- The facts
- The implications
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- Figure 16: Potential interest in using loans to finance car and home improvement, by age and gender, April 2014
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- Figure 17: Motivating factors for people to use loans among existing car loan users, April 2014
- Figure 18: Potential interest in using loans to finance holidays and luxury products, by city, April 2014
- How to market loan products to young adults?
- The facts
- The implications
- What innovations can encourage people to use more loans and credit products?
- The facts
- The implications
Trend Applications
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- Dispel the myth about scary loans
- Insurance cover for forgetful credit card users
- Do it now rather than regret later
Trends in Consumer Lending
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- Key points
- Loans to households: four times its size in 2008
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- Figure 19: Loans to households, China 2008-April 2014
- Short-term consumption loans have grown faster
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- Figure 20: Share of total loans to households by loan type and growth rates, China 2008-13
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- Figure 21: Size of credit granted and overdraft on credit cards, China 2009-2014 (Q1)
- Future growth outlook
- The removal of bank lending rate floor
- More private capital in the banking sector and retailers’ innovation
- The rise of online P2P lending
- Consumer lending to account for two thirds of GDP by 2020
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- Figure 22: Projected share of different types of loans in household lending, China 2013 versus 2020
The Consumer – Usage of Credit and Loan Products
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- Key points
- 85% of consumers have undertaken some sort of money borrowing
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- Figure 23: Usage of credit cards, loans or other credit products, April 2014
- Credit card usage by target group
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- Figure 24: Usage of credit cards, by age and gender, April 2014
- 20-39-year-olds are more likely to need loans to cope
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- Figure 25: Usage of loans, by age, April 2014
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- Figure 26: Repertoire of usage of credit cards, loans or other credit products, by age, April 2014
- Different approaches by high and low earners
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- Figure 27: Usage of loans, by income, April 2014
- Borrowing from people I know happens more often in tier two/three cities
- Usage of credit and loan products goes up with education level
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- Figure 28: Repertoire of usage of credit cards, loans or other credit products, by demographics, April 2014
The Consumer – Reasons for Not Using Loans or Credit Products
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- Key points
- Not used to the idea of being in debt is still the number one barrier…
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- Figure 29: Reasons for not using loans or credit products, April 2014
- …but there are still some differences across age groups
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- Figure 30: Reasons for not using loans or credit products, by age, April 2014
The Consumer – Purpose of Using Loans
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- Key points
- Home improvement and investment are top two purposes
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- Figure 31: Purpose of using loans, April 2014
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- Figure 32: Selected purposes of using loans, by age group, April 2014
- Big potential for car loan to grow over the next few years
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- Figure 33: Potential interest in using loans, April 2014
- Marketing loan products according to needs state by lifestage
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- Figure 34: Selected potential interest in using loans, by age, April 2014
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- Figure 35: Selected potential interest in using loans, by age, April 2014
- Tier one cities versus tier two/three cities
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- Figure 36: Potential interest in using loans, by city tiers, April 2014
The Consumer – Motivating Factors for Using Loans
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- Key points
- What consumers expect most: flexible terms and lower cost
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- Figure 37: Factors that encourage consumers to use loan products to cover household expenditure, April 2014
- Higher income groups are more demanding in both product and process
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- Figure 38: Factors that encourage consumers to use loan products to cover household expenditure, by income, April 2014
- Making it easier for young adults with short-term needs
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- Figure 39: Factors that encourage consumers to use loan products to cover household expenditure, by age, April 2014
- Different considerations based on purpose of the loan
The Consumer –Credit Card Usage Habits
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- Key points
- The majority use credit cards as a money management tool rather than a source of credit
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- Figure 40: Credit card usage habits, April 2014
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- Figure 41: Credit card usage habits – “Being charged for late payment” by income and city tier, April 2014
- Different views about paying by instalments
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- Figure 42: Credit card usage habits (continued), April 2014
- Women are more motivated by reward schemes
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- Figure 43: Credit card usage habits – “Using my credit card just for getting bonus points”, by gender, April 2014
- Using credit cards overseas and increasing credit limits
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- Figure 44: Credit card usage habits (continued), April 2014
The Consumer – Attitudes towards Credit and Loans
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- Key points
- People are generally becoming more open to borrowing…
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- Figure 45: Consumer attitudes towards borrowing money, April 2014
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- Figure 46: Consumer attitudes towards borrowing money (continued), April 2014
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- Figure 47: Agreement on “Borrowing money can be a useful way to protect savings/investments.”, April 2014
- …but about half of them still prefer to live within their means
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- Figure 48: Consumer attitudes towards spending by borrowing, April 2014
- Tier two/three consumers are more conservative
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- Figure 49: Consumer attitudes towards spending by borrowing, by city tier, April 2014
- Helping people to understand better about loan products is key
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- Figure 50: Consumer attitudes towards loan services, April 2014
- The majority think banks are more reliable than online P2P lending sites
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- Figure 51: Consumer attitudes towards P2P lending, April 2014
- People are more positive about the benefits of credit cards…
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- Figure 52: Consumer attitudes towards using credit services, April 2014
- …yet not everyone feels relaxed about relying on credit cards
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- Figure 53: Consumer attitudes towards using credit services, April 2014
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- Figure 54: Agreement on “Using credit card is a reflection of irrational spending”, by demographics, April 2014
Consumer Segmentation
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- Key points
- A spectrum of attitudes towards debt and credit
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- Figure 55: Consumer segmentation, April 2014
- The Conservative
- 22% of online population surveyed
- Demographic traits
- Marketing perspective
- The Progressive (42%)
- 42% of the online population surveyed
- Demographic traits
- Marketing perspective
- The Neutral
- 36% of the online population surveyed
- Demographic traits
- Marketing perspectives
Appendix – Usage of Credit and Loan Products
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- Figure 56: Usage of credit cards, loans or other credit products, April 2014
- Figure 57: Usage of credit cards, loans or other credit products, by demographics, April 2014
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- Figure 58: Repertoire of usage of credit cards, loans or other credit products, April 2014
- Figure 59: Repertoire of usage of credit cards, loans or other credit products, by demographics, April 2014
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Appendix – Reasons for Not Using Loans or Credit Products
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- Figure 60: Reasons for not using loans or credit products, April 2014
- Figure 61: Most popular reasons for not using loans or credit products, by demographics, April 2014
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- Figure 62: Next most popular reasons for not using loans or credit products, by demographics, April 2014
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Appendix – Purpose of Using Loans – Current
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- Figure 63: Purpose of using loans in the past, April 2014
- Figure 64: Most popular purpose of using loans in the past, by demographics, April 2014
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- Figure 65: Next most popular purpose of using loans in the past, by demographics, April 2014
- Figure 66: Purpose of using loans in the past, by usage of credit cards, loans or other credit products, April 2014
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Appendix – Purpose of Using Loans – Near Future
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- Figure 67: Potential interest in using loans, April 2014
- Figure 68: Most popular potential interest in using loans, by demographics, April 2014
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- Figure 69: Next most popular potential interest in using loans, by demographics, April 2014
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Appendix – Motivation Factors for Using Loans
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- Figure 70: Factors that encourage consumers to use loan products to cover household expenditure, April 2014
- Figure 71: Most popular factors that encourage consumers to use loan products to cover household expenditure, by demographics, April 2014
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- Figure 72: Next most popular factors that encourage consumers to use loan products to cover household expenditure, by demographics, April 2014
- Figure 73: Factors that encourage consumers to use loan products to cover household expenditure, by Potential interest in using loans, April 2014
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- Figure 74: Factors that encourage consumers to use loan products to cover household expenditure, by Potential interest in using loans, continued table, April 2014
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Appendix – Credit Card Usage Habits
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- Figure 75: Credit card usage habits, April 2014
- Figure 76: Usage of credit card – Application to increase my credit limit, by demographics, April 2014
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- Figure 77: Usage of credit card – Being charged for late payment, by demographics, April 2014
- Figure 78: Usage of credit card – Using up more than half of my credit balance, by demographics, April 2014
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- Figure 79: Usage of credit card – Paying only the minimum monthly amount of my credit balance, by demographics, April 2014
- Figure 80: Usage of credit card – Paying by credit card is my first payment choice, by demographics, April 2014
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- Figure 81: Usage of credit card – Paying in instalments whenever this is available, by demographics, April 2014
- Figure 82: Usage of credit card – Using my credit card overseas, by demographics, April 2014
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- Figure 83: Usage of credit card – Using my credit card just for getting bonus points, by demographics, April 2014
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Appendix – Consumer Attitudes towards Credits and Loans
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- Figure 84: Consumer attitudes towards credits and loans, April 2014
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- Figure 85: Agreement with the statement ’Only those who are struggling with their financial situation need to borrow money’, by demographics, April 2014
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- Figure 86: Agreement with the statement ’It is better to save up for something rather than taking out a credit/loan’, by demographics, April 2014
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- Figure 87: Agreement with the statement ’It is better to spend only what you can afford rather than taking out an overdraft’, by demographics, April 2014
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- Figure 88: Agreement with the statement ’Borrowing money is acceptable as long as you can repay it on time’, by demographics, April 2014
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- Figure 89: Agreement with the statement ’Borrowing money can be a useful way to protect savings/investments’, by demographics, April 2014
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- Figure 90: Agreement with the statement ’I am becoming more comfortable about being in debt than before’, by demographics, April 2014
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- Figure 91: Agreement with the statement ’Earning bonus points by using credit card is appealing to me’, by demographics, April 2014
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- Figure 92: Agreement with the statement ’Credit cards can offer more flexibility when managing finances’, by demographics, April 2014
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- Figure 93: Agreement with the statement ’Using credit cards is a reflection of irrational spending’, by demographics, April 2014
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- Figure 94: Agreement with the statement ’I am worried about relying too much on purchasing on credit’, by demographics, April 2014
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- Figure 95: Agreement with the statement ’I would proactively consider using loan products if there were better loan services’, by demographics, April 2014
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- Figure 96: Agreement with the statement ’It is more reliable to take loans from a bank than from an online agency’, by demographics, April 2014
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Appendix – Consumer Segmentation
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- Figure 97: Consumer segmentation, April 2014
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- Figure 98: Consumer segmentation, by demographics, April 2014
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- Figure 99: Usage of credit cards, loans or other credit products, by target groups, April 2014
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- Figure 100: Reasons for not using loans or credit products, by target groups, April 2014
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- Figure 101: Purpose of using loans in the past, by target groups, April 2014
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- Figure 102: Potential interest in using loans, by target groups, April 2014
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- Figure 103: Factors that encourage consumers to use loan products to cover household expenditure, by target groups, April 2014
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- Figure 104: Usage of credit card, by target groups, April 2014
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- Figure 105: Consumer attitudes towards credit and loans, by target groups, April 2014
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