Marketplace Lending (Consumer) - Israel

The total transaction value in the MarketMarketplace Lending (Consumer) market market in Israel is projected to reach US$98.51m in 2024.
When compared globally, it is evident that the United States leads with a transaction value of US$28bn in 2024.
Key Market Indicators offer a comprehensive view of the social and economic landscape of Israel, shedding light on market-specific trends.
These indicators, combined with information from statistical offices, trade associations, and businesses, form the basis for the Statista market models.
In Israel, Marketplace Lending in the Consumer Capital Raising market is gaining traction due to increasing demand for alternative financing options.

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 Israel has been experiencing significant growth in recent years.

Customer preferences: Israeli consumers have shown a growing preference for marketplace lending platforms due to their convenience and accessibility. These platforms provide borrowers with an alternative to traditional banks, offering faster loan approval processes and more flexible lending terms. Additionally, marketplace lending platforms often cater to borrowers who may have difficulty obtaining loans from traditional financial institutions, such as those with limited credit history or self-employed individuals.

Trends in the market: One of the key trends in the marketplace lending market in Israel is the increasing adoption of technology. Israeli consumers are known for their tech-savviness, and this is reflected in their embrace of digital lending platforms. These platforms leverage advanced algorithms and data analytics to assess borrowers' creditworthiness and determine loan terms. This technology-driven approach allows for faster and more accurate loan approvals, resulting in a seamless borrowing experience for consumers. Another trend in the marketplace lending market in Israel is the diversification of loan products. Initially, marketplace lending platforms primarily focused on personal loans. However, there has been a shift towards offering a wider range of loan products, including mortgages, business loans, and student loans. This expansion of loan offerings has allowed marketplace lending platforms to cater to a broader customer base and meet the diverse borrowing needs of Israeli consumers.

Local special circumstances: Israel's small size and close-knit business community have created a unique lending environment. The country's strong entrepreneurial culture has led to a high demand for business loans, particularly among startups and small businesses. Marketplace lending platforms have capitalized on this demand by offering streamlined loan application processes and competitive interest rates, making it easier for entrepreneurs to access the capital they need to grow their businesses. Additionally, Israel's high cost of living has made personal loans a popular choice among consumers. Many Israelis turn to marketplace lending platforms to finance major expenses such as home renovations, weddings, or education. The convenience and flexibility offered by these platforms have made them an attractive alternative to traditional banks for personal loans.

Underlying macroeconomic factors: Israel's strong economy and low unemployment rate have contributed to the growth of the marketplace lending market. With a stable financial system and a robust regulatory framework, Israeli consumers have confidence in the reliability and security of marketplace lending platforms. The country's high internet penetration rate and widespread smartphone usage have also facilitated the adoption of digital lending platforms. Furthermore, the Israeli government has recognized the importance of fostering innovation in the financial sector and has implemented policies to support the growth of marketplace lending. These policies include regulatory reforms aimed at promoting competition and encouraging the development of fintech companies. This supportive regulatory environment has attracted both domestic and international marketplace lending platforms to operate in Israel, further fueling the market's growth. In conclusion, the Marketplace Lending (Consumer) market in Israel is experiencing significant growth due to customer preferences for convenience and accessibility, the adoption of technology-driven lending platforms, the diversification of loan products, local special circumstances such as the high demand for business and personal loans, and underlying macroeconomic factors including a strong economy and supportive regulatory environment.

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.