The 60+ generation uses consumer finance lending much more frequently today than it did ten years ago. With a repayment rate of 98%, not very young borrowers prove particularly reliable. It is all the more incomprehensible that many banks no longer lend money from the age of 58.
The Credit bureau Credit Compass 2012 is particularly detailed on the credit usage behavior of the 60+ generation. In the age group 60-64, the proportion of persons with a loan has increased by 41% in the last ten years. In the group of 65-69 year old Germany’s most important credit agency recorded an increase of 26%. Among the 70-74 year-olds, the increase was 65%, and for the over-74s, the increase was 113%.
Borrowers in the best years are considered to be particularly reliable.
One reason for this is that many economic issues have already been resolved in this period of life. The Credit bureau records 95.9% of all over 60-year-olds in their database exclusively positive features. This is a significantly higher value than in the total population, in which the Credit bureau did not store any negative features at 91.2%.
The credit default risk for over 60-year-old borrowers is also lower than for the general population. For the total population, Credit bureau specifies a repayment installment of 97.5%. For over 60 year olds it is 98%. The value for the total population is also very high. In this context, Credit bureau and other Credit bureaus like to cite the fact that the strict lending guidelines and the consistent review of the payment history (this is the purpose of the Credit bureau clause in credit agreements) contribute to the low default rate.
Credit bureau has commissioned another study, which deals with the sensitivities and economic conditions of the 60+ generation. In the age group there are 21.5 million federal citizens. These have an annual purchasing power of 400 billion euros. By the year 2030, the number of over 60-year-old citizens in Germany will rise to 28.5 million. For this reason, the Credit bureau wants to devote greater attention to this age group.
It would be very pleasing if in the future more banks would welcome customers over 60 with open arms. Many banks are extremely restrictive towards not-so-young customers. This is also confirmed by study results that show a particular interest of older borrowers in Peer2Peer platforms. There, the generation feels 60+ and 70+ better kept.
Credit bureau reports on developments in the German credit market with its annual loan compass. The number of current installment credits in 2011 remained virtually unchanged compared with the previous year, with the repayment rate remaining unchanged: Federal borrowers maintained 17.2 million loans registered with the Credit bureau. However, the average volume of lending rose by 8.6% year-on-year to € 7,712.
The agency also compares the values of the year 2011 with those of the year 2001. In the long-term perspective, some developments appear in a different light. Average loan volume remained constant compared to 2001. In the meantime, according to the Credit bureau, there were again and again fluctuations of 10% up or down.
The number of installment loans has increased more than 52% in the last ten years.
Credit bureau emphasizes that this has not changed the high repayment rate. She also reports that consumers compare loans more closely today than they did ten years ago. While shortly after the turn of the millennium there were 1.5 requests for each loan, today there are 1.8 requests per loan.
Noteworthy is the number of those for whom the Credit bureau has not stored exclusively positive features. That’s at least 8.8% of the population in the database. According to its own information, the Credit bureau stores 479 million features to 66.2 million consumers. If 8.8% of them have negative characteristics, this corresponds to more than 5.8 million people.