Lending Global Market Report 2022

Executive Summary

Major companies in the lending market include China Construction Bank, Agricultural Bank Of China, JPMorgan Chase & Co., Bank of China, Industrial and Commercial Bank of China, Citi Group, Bank of America Corporation, State Bank of India, Mitsubishi UFJ Financial Group, and Legal & General Group plc

The global lending market is expected to grow from $7,070.08 billion in 2021 to $7,833.88 billion in 2022 at a compound annual growth rate (CAGR) of 10.8%. The market is expected to grow to $11,285.05 billion in 2026 at a compound annual growth rate (CAGR) of 9.6%.

The lending market consists of sales of lending services (loans) by entities (organizations, sole traders, and partnerships) that are engaged in providing secured or unsecured loans to borrowing entities. Lending entities include establishments such as finance companies, personal credit institutions, loan companies, and student loans companies. This market covers all types of loans including mortgage loans, personal loans, working capital loans, vehicle loans, and industrial loans. Revenue generated from the lending market includes all the interest charges levied by the lending entities such as banks and financial institutions against the loans sanctioned, but not the value of the loans themselves. This market includes interest charged by the banks on credit cards and other payment cards as well as mortgages and other loans.

The main types of lending are corporate lending, household lending, and government lending. Corporate lending refers to a loan that is a business loan intended for business purposes. The variable interest rates are fixed-rate, floating rates. The different lending channels include offline and online.

Western Europe was the largest region in the lending market in 2021. Asia Pacific was the second-largest region in the lending market. The regions covered in this report are Asia-Pacific, Western Europe, Eastern Europe, North America, South America, Middle East, and Africa.

Banks and financial institutions are adopting digitization solutions to modernize their commercial lending business. This move is mainly a result of increased competition among banks and growing demand for the simplified and quick commercial lending process. Digitization enables faster approval of commercial loans, which can otherwise be a complex and slow process. It also enables banks to target new customer categories and offer customer-centric solutions, which leads to improved efficiencies in the commercial lending business. Major companies which incorporated digitization in lending are Commonwealth Bank of Australia, Hana Bank, and Fidor Bank.

Participation lending, also known as syndicated lending, is gaining prominence as it reduces risks associated with lending large capital. Participation lending is the process of providing a loan by multiple lenders to one borrower. Participation loans are usually provided by one financial institution and administered by another. The popularity of participation lending is becoming popular as it provides a channel to offer diversified loan products and improves the liquidity of the business. This partnership offers larger business lending opportunities to financial institutions by allowing them to share both funding and risk. It eliminates the need for manual tracking of information by optimizing the entire lending process. Some of the companies involved in participation lending are Coastway Community Bank, Shamrock Financial Corp., and Homestar Mortgage.

The countries covered in the lending market are Argentina, Australia, Austria, Belgium, Brazil, Canada, Chile, China, Colombia, Czech Republic, Denmark, Egypt, Finland, France, Germany, Hong Kong, India, Indonesia, Ireland, Israel, Italy, Japan, Malaysia, Mexico, Netherlands, New Zealand, Nigeria, Norway, Peru, Philippines, Poland, Portugal, Romania, Russia, Saudi Arabia, Singapore, South Africa, South Korea, Spain, Sweden, Switzerland, Thailand, Turkey, UAE, UK, USA, Venezuela, and Vietnam.

Companies Mentioned

A selection of companies mentioned in this report includes:

• China Construction Bank
• Agricultural Bank Of China
• JPMorgan Chase & Co.
• Bank of China
• Industrial and Commercial Bank of China
• Citi Group
• Bank of America Corporation
• State Bank of India
• Mitsubishi UFJ Financial Group
• Legal & General Group plc.

Methodology