Europe Alternative Lending Business Report 2023-2027: Bridging the Gap Between B2C and B2B Lending, A Growing Industry with Strong Investment Prospects

DUBLIN, Nov. 21, 2023 /PRNewswire/ -- The "Europe Alternative Lending Market Business and Investment Opportunities Databook - 75+ KPIs on Alternative Lending Market Size, By End User, By Finance Model, By Payment Instrument, By Loan Type and Demographics - Q2 2023 Update" report has been added to  ResearchAndMarkets.com's offering.

Alternative lending market in Europe is expected to grow by 19.3% on an annual basis to reach US$80.2 billion in 2023. 

This report offers a comprehensive data-driven analysis of the alternative lending market, providing in-depth insights into its market potential and various aspects. It conducts a detailed examination of the alternative lending market, leveraging key economic indicators to offer a holistic perspective of this dynamic landscape. 

Medium to long term growth story of alternative lending in Europe remains strong. Alternative lending adoption is expected to grow steadily over the forecast period, recording a CAGR of 10.6% during 2023-2027. The alternative lending market in the region will increase from US$67.2 billion in 2022 to reach US$120.1 billion by 2027.

The report extensively covers the alternative lending market, encompassing various aspects such as overall market size, forecasts, detailed analyses of end-user segments, diverse financial models, and intricate payment instrument dynamics.

In the European market, the alternative lending industry has exhibited positive growth following the global pandemic outbreak. These service providers played a crucial role in offering working capital support to numerous small and medium-sized businesses when traditional banks were facing challenges in meeting the funding needs of a rising number of firms. In 2023, the market is poised for further growth, driven by factors such as higher inflation and an evolving interest rate environment.

The competitive landscape in the European market is also evolving rapidly amid increasing credit demand. With companies securing funding rounds to accelerate their growth, expand their customer base, and invest in technology, the sector is expected to experience robust growth over the next five years.

The United Kingdom is anticipated to lead regional growth in the short to medium term. Furthermore, there is an expectation that more global players will expand their service offerings and presence in the European market through mergers and acquisitions.

This report provides valuable insights into the complex relationships between payment instruments and lending models, offering a comprehensive breakdown of transaction dynamics.

It explores the multifaceted nature of loans, encompassing personalized B2C offerings like payroll advances and strategic B2B solutions such as lines of credit. Additionally, the report delves into consumer attitudes and behaviors, deciphering the influence of factors like age, income, and gender on financial decision-making.

Rising inflation and soaring cost of living are leading more consumers towards alternative lenders, including BNPL providers

Inflation has reached multi-year highs in most European markets. With the soaring cost of living, consumers are finding it difficult to fund their daily purchases and as a result, many are turning to alternative lenders, including buy now pay later providers. Young generation consumers, on the other hand, are still most likely to use the deferred payment solution.

Of the 18 to 24-year-olds surveyed by the Centre for Financial Capability, 54% of the consumers are likely to take out short-term credit loans from a BNPL provider over the next 12 months in the United Kingdom. This represents a growth of 6% compared to 2021. The fact that consumers across all age groups are turning to the BNPL payment method shows that the demand for short-term credit will remain robust in 2023, thereby aiding the growth of the alternative lending market in Europe.

Alternative lenders are raising capital rounds to accelerate growth and expansion in the regional market

The alternative lending industry is poised to record strong growth over the next three to four years. To tap into the high-growth potential of the segment, firms are raising venture capital and private equity funding to accelerate their growth and expand their regional presence in Europe.

In March 2023, Abound, a United Kingdom-based consumer lending service, announced that the firm had raised US$601 million in a debt and equity funding round. The firm is planning to invest the capital for financing loans, bringing more customers to its platform, and investing in technology. In addition to its presence in the B2C segment, the firm is also planning to expand operations into the B2B category in Europe.

ArK Kapital, another alternative lending provider in Europe, announced that the firm had raised €100 million in March 2023. The funding round will not only boost its available capital pool but will also enable the firm to expand its presence in the German market in 2023. In addition to its home market Sweden, the firm is also operating in Denmark, Finland, the Netherlands, and the United Kingdom.

In January 2023, October, the alternative lender focused on the SME market, announced that the firm had raised €35 million in a funding round. The capital infusion came from European Investment Fund and Invest-NL. The firm is planning to use the capital to provide credit to over 3,000 SMEs in Europe. Over the next two years, the firm targets a total of €400 million in lending.

Going forward, the publisher expects more such alternative lending providers to raise funding rounds in Europe, which will subsequently aid the competitive landscape, innovation, and market growth over the next five years.

Challenger banks and digital lenders are recording strong growth amid the current macroeconomic environment in the United Kingdom

Freedom Finance, one of the leading digital consumer lending platforms, revealed that loans requested on the platform from online lenders surged by 9% in 2022 when compared to the year before. The firm also revealed that the demand on its platform has increased 50% as of April 2023, compared to the same period in 2022.

Much of the demand is coming from new users with higher incomes. Freedom Finance also announced that digital lenders and challenger banks have increased their unsecured personal lending to consumers by more than £1.5 billion in 2022. This represents a 34% growth year over year. From the short to medium-term perspective, the publisher expects further growth in loan disbursals, thereby aiding the growth of the alternative lending market in the United Kingdom.

This title is a bundled offering, combining the following 17 reports:

• Europe Alternative Lending Business and Investment Opportunities Databook
• Austria Alternative Lending Business and Investment Opportunities Databook
• Belgium Alternative Lending Business and Investment Opportunities Databook
• Denmark Alternative Lending Business and Investment Opportunities Databook
• Finland Alternative Lending Business and Investment Opportunities Databook
• France Alternative Lending Business and Investment Opportunities Databook
• Germany Alternative Lending Business and Investment Opportunities Databook
• Greece Alternative Lending Business and Investment Opportunities Databook
• Ireland Alternative Lending Business and Investment Opportunities Databook
• Israel Alternative Lending Business and Investment Opportunities Databook
• Italy Alternative Lending Business and Investment Opportunities Databook
• Netherlands Alternative Lending Business and Investment Opportunities Databook
• Poland Alternative Lending Business and Investment Opportunities Databook
• Russia Alternative Lending Business and Investment Opportunities Databook
• Spain Alternative Lending Business and Investment Opportunities Databook
• Switzerland Alternative Lending Business and Investment Opportunities Databook
• United Kingdom Alternative Lending Business and Investment Opportunities Databook

Scope for Each Report

Alternative Lending Market Size and Forecast by Loan Types

• B2C Loans
• Personal Loan
• Payroll Advance
• Home Improvement
• Education/Student Loans
• Point of Sale
• Auto Loans
• Medical Loans
• B2B Loans
• Lines of Credit
• Merchant Cash Advance
• Invoice Factoring
• Revenue Financing

Alternative Lending Analysis by Consumer Attitude and Behaviour

• By Age
• By Income
• Gender

Economic Indicators

• Gross Domestic Product at Current Prices
• Population
• Unbanked Population
• Unemployment Rate
• Loan Default Rate

Alternative Lending Market Size and Forecast

• Transaction Value
• Average Transaction Value
• Transaction Volume

Alternative Lending Market Size and Forecast by End User

• End User - Business
• End User - Consumer

Alternative Lending Market Size and Forecast by Finance Models

• P2P Marketplace Consumer Lending
• P2P Marketplace Business Lending
• P2P Marketplace Property Lending
• Balance Sheet Consumer Lending
• Balance Sheet Business Lending
• Balance Sheet Property Lending
• Invoice Trading
• Debt Based Securities
• Equity Based Crowd Funding
• Real Estate Crowd funding

Alternative Lending Market Size and Forecast by Payment Instrument - Transaction Value, Volume and Average Value

• Cash
• Cheques
• Credit Transfer
• Direct Debits
• Debit Card
• Credit Card
• E- Money

Alternative Lending Market Size and Forecast by Payment Instrument to Model

Alternative Lending Market Size and Forecast by Payment Instrument to P2P Marketplace Consumer Lending

• Cash
• Cheques
• Credit Transfer
• Direct Debits
• Debit Card
• Credit Card
• E- Money

Alternative Lending Market Size and Forecast by Payment Instrument to P2P Marketplace Business Lending

Alternative Lending Market Size and Forecast by Payment Instrument to P2P Marketplace Property Lending

Alternative Lending Market Size and Forecast by Payment Instrument to Balance Sheet Consumer Lending

Alternative Lending Market Size and Forecast by Payment Instrument to Balance Sheet Business Lending

Alternative Lending Market Size and Forecast by Payment Instrument to Balance Sheet Property Lending

Alternative Lending Market Size and Forecast by Payment Instrument to Invoice Trading

Alternative Lending Market Size and Forecast by Payment Instrument to Debt Based Securities

Alternative Lending Market Size and Forecast by Payment Instrument to Equity Based Crowd Funding

Alternative Lending Market Size and Forecast by Payment Instrument to Real Estate Crowd funding

For more information about this report visit https://www.researchandmarkets.com/r/9nkp7u

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