Consumer Lending Trends 2024

How Financial Institutions Can Eliminate Customer Roadblocks and Win Back Share From Nonbanks

Report by Lauren Ashcraft  | UPDATED: Jul 30, 2024
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Executive Summary
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Table of Contents
Executive Summary
US FIs face a sluggish lending market, while nonbank competitors secure a growing share of customers
Nonbanks have capitalized on the changing mortgage environment, while some banks exited the business
Young consumers have gravitated toward alternative lending solutions
Outdated lending criteria and application processes prevent customers from seeking loans from FIs
Sources
Media Gallery
About This Report
Financial institutions are vying with nonbanks for customers in a sluggish lending market. Updating their marketing, lending, and product strategies can help attract and keep customers, slowing the outflow to nonbank lenders.
Topics
Financial Services
Banking
US
Table of Contents
Executive Summary
US FIs face a sluggish lending market, while nonbank competitors secure a growing share of customers
Nonbanks have capitalized on the changing mortgage environment, while some banks exited the business
Young consumers have gravitated toward alternative lending solutions
Outdated lending criteria and application processes prevent customers from seeking loans from FIs
Sources
Media Gallery

Key US consumer groups feel shut out from traditional lending practices and are turning toward more accessible products offered by nonbank competitors. Understanding what’s causing them to look elsewhere can help traditional financial institutions (FIs) boost lending sales and prevent customer attrition.

Key Question: How can traditional FIs attract new lending customers and reengage existing customers to prevent outflows to nonbank competitors?

US Lending by Small and Large Banks, July 2022-Jan 2024 (trillions)
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Key Stat: Loan growth at US banks has slowed in the past few years, with lending at large banks declining early this year, per the Federal Reserve Banks. Nonbank competitors continue to sweep up a growing share of the market.

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Table of Contents

  1. Executive Summary
  2. US FIs face a sluggish lending market, while nonbank competitors secure a growing share of customers
  3. Nonbanks have capitalized on the changing mortgage environment, while some banks exited the business
  1. Young consumers have gravitated toward alternative lending solutions
  2. Outdated lending criteria and application processes prevent customers from seeking loans from FIs
  3. Sources
  1. Media Gallery

Charts in This Report

US Lending by Small and Large Banks, July 2022-Jan 2024 (trillions)Top 10 US Lenders, by Mortgage Originations, 2022-2023 (billions and % of total mortgage market originations)
Half of Recent Lending Applications in the US Have Ended in Denial (% of US loan applicants, Feb 2024)

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First Published on Jun 20, 2024

authors

Lauren Ashcraft

Contributors

Suzy Davidkhanian
VP, Content
Tiffani Montez
Amy Rotondo
Director, US Research