Better lending during the cost of living crisis

How do we ensure better lending during the cost of living crisis?

Accept rates for credit union loans have fallen significantly over the last year. This can be partly explained by the increasing indebtedness of borrowers. The average non-mortgage debt of credit union applicants rose by 14% in the year ending February 2023.

However, applicant income was also up 10%. Credit scores have been rising. Interestingly, the average utility debt has fallen over the last 12 months.

Is the cost of living crisis making responsible lenders too nervous? Maybe. However, the combination of growing indebtedness and rising interest rates increases lending risk. Furthermore there is evidence that more borrowers are showing signs of early arrears.

Last weekend we ran a breakout session for 60+ ABCUL conference attendees. If you’re not an ABCUL member or couldn’t make it – we’re repeating this popular session online on 30th March at 10:30.

We’ll be assessing the impact of the Cost of Living Crisis on credit union borrowers by looking at 75,000 lending decisions over the last year. Critically, there are still ways to grow the loan book during these difficult times. We’ll explore the options.

Join us on Thursday 30 March at 10.30 for one hour and consider strategies for better lending during the cost of living crisis.

Click below to register

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Adrian Davies

Adrian is a co-founder at NestEgg. He is an alternative finance and credit union expert. Adrian has 25 years’ experience in the money advice and responsible lending sectors, supporting credit unions with innovative ideas so they can grow and meet member needs.

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