Consumer Lending Industry Profile

Companies in this industry make unsecured cash loans to consumers. Major companies include US-based DFC Global (dba Money Mart Financial Services), EZCORP, FirstCash, OneMain Holdings, and SLM (better known as Sallie Mae), along with Provident Financial and Tesco Personal Finance (both based in the UK) and Orient Corporation (Japan).

Global household debt topped $47 trillion in 2020, more than $12 trillion higher than in the run-up to the 2008 global financial crisis, according to the Institute for International Finance's Global Debt Monitor. In the US, total consumer debt (personal debt owed by an individual to another entity) approached $4.2 trillion in January 2020, according to the Federal Reserve. Consumer lending companies generally do business locally or within their country of origin, but globalization and greater access to the internet are spurring companies to pursue international growth.

The US consumer lending industry consists of more than 14,000 establishments (single-location companies and units of multi-location companies) with combined annual revenue of about $36.5 billion.

COMPETITIVE LANDSCAPE

Demand is driven by consumer income and demographics. The profitability of individual companies depends on the correct assessment of repayment likelihood and effective collections activities. Large companies enjoy economies of scale in securing access to capital. Small companies can compete effectively by choosing favorable locations or targeting niche markets. The US industry is highly concentrated: the 50 largest companies account for about 85% of revenue.

The federal financial reform law ...