Marketplace Lending (Consumer) - Bulgaria

The projected total transaction value in the MarketMarketplace Lending (Consumer) market market in Bulgaria is expected to reach US$9.17m in 2024.
When compared globally, the United States leads with a transaction value of US$28bn in 2024.
Key Market Indicators offer a snapshot of the social and economic landscape in Bulgaria, shedding light on market-specific trends.
These indicators, supported by data from statistical offices, trade associations, and companies, form the basis for the Statista market models.
Bulgaria's marketplace lending sector is gaining traction, with consumer capital raising platforms offering attractive investment opportunities in the country's growing digital finance market.

Definition:

Marketplace Lending platforms offer private users the option to place requests for loans in an online marketplace to find private investors who would invest at an appropriate interest rate. These services apply a credit score and list the financial requests by intended purpose before fixing a lending rate. One or more investors can then serve the credit request. Although banks act in cooperation with the platform providers, the lending is done, in principle, without direct exposure, risk audits or the formal requirements normally associated with credit lending. This is attractive for many users because the processes are expedited, there is less demand when it comes of the borrower’s creditworthiness and the conditions are often more flexible than with traditional bank loans. Users are defined in this case as active borrowers on an online platform; applicants or investors who are only partially recorded as users are not included. The amount of outstanding, short-term installments or consumer loans recognized during the applicable year is used here as a benchmark.

Additional Information:

Key players in the market are Lending Club, Zopa, Auxmoney and Prosper.

Online marketplace for personal loan applications and private investors
Peer-to-Peer loans with interest rates depending on internal credit scoring of the platform provider

Online comparison websites for bank loans
Traditional bank loans
Loans for business purposes (see Crowdlending)

The Marketplace Lending (Consumer) market in Bulgaria has been experiencing significant growth in recent years.

Customer preferences: Bulgarian consumers have shown a growing preference for marketplace lending as an alternative to traditional banking institutions. This can be attributed to several factors, including the convenience and speed of the lending process, the ability to access loans without collateral, and the competitive interest rates offered by marketplace lenders. Additionally, the ease of online applications and the availability of personalized loan options have also contributed to the increasing popularity of marketplace lending among Bulgarian consumers.

Trends in the market: One of the key trends in the Bulgarian marketplace lending market is the rise of peer-to-peer lending platforms. These platforms connect borrowers directly with individual lenders, eliminating the need for traditional financial intermediaries. This trend has been fueled by the increasing trust and confidence in online lending platforms, as well as the desire for more transparent and efficient lending processes. Another trend in the market is the diversification of loan products offered by marketplace lenders. In addition to traditional personal loans, marketplace lenders in Bulgaria have started offering specialized loan products, such as student loans, small business loans, and debt consolidation loans. This trend reflects the evolving needs of Bulgarian consumers and their desire for more tailored lending solutions.

Local special circumstances: Bulgaria's marketplace lending market has been influenced by several local special circumstances. One of these is the relatively low level of financial inclusion in the country. Many Bulgarian consumers, especially those in rural areas, have limited access to traditional banking services. Marketplace lending platforms have emerged as a viable alternative for these consumers, providing them with access to credit that was previously unavailable to them. Another special circumstance is the high level of non-performing loans in the Bulgarian banking sector. This has made traditional banks more cautious in their lending practices, resulting in stricter loan approval criteria and limited access to credit for many consumers. Marketplace lenders, on the other hand, have been able to fill this gap by offering loans to borrowers who may not meet the stringent requirements of traditional banks.

Underlying macroeconomic factors: The development of the marketplace lending market in Bulgaria can be attributed to several underlying macroeconomic factors. One of these is the country's strong economic growth, which has increased the demand for credit among Bulgarian consumers. As the economy continues to expand, more individuals are seeking loans for various purposes, such as home renovations, education, and starting a business. Another macroeconomic factor is the low interest rate environment in Bulgaria. The European Central Bank's accommodative monetary policy has resulted in historically low interest rates, making borrowing more affordable for consumers. This has created an opportune environment for marketplace lenders to attract borrowers with competitive interest rates and flexible loan terms. In conclusion, the Marketplace Lending (Consumer) market in Bulgaria is experiencing growth due to customer preferences for convenience and competitive interest rates, the rise of peer-to-peer lending platforms, the diversification of loan products, local special circumstances such as limited financial inclusion and high non-performing loans, and underlying macroeconomic factors such as strong economic growth and low interest rates.

Data coverage:

The data encompasses B2C enterprises. Figures are based on transaction values / revenues / assets under management and user data of relevant services and products offered within the FinTech market.

Modeling approach / Market size:

Market sizes are determined through a combined top-down and bottom-up approach, building on a specific rationale for each market segment. As a basis for evaluating markets, we use annual financial reports of key players, industry reports, third-party reports, publicly available databases, and survey results from primary research (e.g., the Statista Global Consumer Survey). In addition, we use relevant key market indicators and data from country-specific associations, such as GDP, consumer spending, population, internet penetration, smartphone penetration, credit card penetration, and online banking penetration. This data helps us estimate the market size for each country individually.

Forecasts:

In our forecasts, we apply diverse forecasting techniques. The selection of forecasting techniques is based on the behavior of the relevant market. For example, the S-curve function and exponential trend smoothing are well suited for forecasting digital products and services due to the non-linear growth of technology adoption.

Additional notes:

The market is updated twice a year in case market dynamics change. The impact of the COVID-19 pandemic and the Russia-Ukraine war is considered at a country-specific level.

This report presents a comprehensive analysis and additional information on the Financial market, in a PDF format.

Crowdfunding is the collective effort of a large number of individuals who network and pool small amounts of capital to finance a new or existing business venture. Each campaign is set for a goal amount of money and a fixed timeframe, each day is counted down and the money raised will be tallied up for visitors to follow its success. The size of the global crowdfunding market is growing and the largest markets are North America and Asia.