Report on Non-Financial Credit Providers

Half-yearly report on the evolution of loans granted by non-financial institutions and the profile of those who access it.

Summary

PNFC Quantity | The number of Non-Financial Credit Providers (PNFCs) reached 469 companies in March 2024, 12 more than in August 2023. A total of 401 companies were registered in the register of Other Non-Financial Credit Providers (OPNFC) and 113 in the register of Non-Financial Companies Issuing Credit and/or Purchase Cards (ETCNB).

Financing Balance | The financing balance reached $2.1 trillion in December 2023, with a contraction of 22% at constant values compared to June 2023. With the exception of the Leasing & Factoring group, which rose 7%, all the remaining groups reduced their balances in real terms in the second half of the year. Other providers was the group that most explained the reduction (8 p.p. of the fall), followed by Fintech (6 p.p.), Sale of household appliances (4 p.p.) and Other business chains and Cooperatives and mutuals (2 p.p. each).

Personal loan financing balances exhibited a steeper drop than credit card balances in the second half of 2023 (-36% and -13% at constant prices, respectively).

Number of Assists | The total amount of assistance granted was down 2% in the semester and reached 15 million by the end of 2023. This evolution contrasts with the sustained growth trend observed from the fourth quarter of 2021 to August 2023.

The number of personal loan assistance did not show significant variations in the semester, while the amount of credit card assistance fell 3%. The Fintech group explained the maintenance of assistance for personal loans.

The average balance for assistance at the end of the year was $74,000 for personal loans and $228,000 for credit card assistance, 36% and 10% less in real terms compared to June 2023, respectively.

Interest Rate on Personal Loans and Credit Cards | The weighted average annual nominal rate (APR) on personal loans reached 213% at the end of 2023, 42 p.p. more than the value of June of the same year, while the weighted average APR of credit card assistance registered a value of 170% in December 2023, with a 69 p.p. increase in the period.

Irregularity | The irregularity of the PNFC portfolio fell 1.7 p.p. in the second half of the year, reaching an all-time low of 10.6%. The irregularity of credit card assistance was reduced by 2 p.p., reaching 3.6% in December 2023. On the other hand, irregularity for personal loans increased 2.4 p.p. and reached 24% at the end of 2023.

Number of debtors | The total number of people with PNFC financing was 10.7 million in December 2023, with an increase of 0.6% compared to June of the same year and 4.8% year-on-year. The Fintech group was the only one to increase its list of debtors in the period, with almost 5.4 million customers at the end of the year, 6% more compared to June 2023 and 19% higher than the last month of 2022.

Debt of PNFC clients to the EEFF

Number of debtors and PH financing balances | During the second half of 2023, there was a 4% growth in the number of shared PH debtors (with EEFF assistance), while a 22% reduction in their balances owed to the SF in real terms.

Funding by Type of Assistance | The total balance of financing for personal loans to PH showed a decrease of 32% in real terms, while for credit cards the amount fell by 17% in the first half of the year. The number of personal loans showed a six-month increase of almost 13%, while the number of credit cards remained constant.

Irregularity of debtors shared with financial institutions | The irregularity with the SF of shared PH debtors showed a reduction from 5.7% to 4.9% in the second half of 2023, reversing the increase observed in the previous period.

Funding of NFPPs with the ESFFs and in the capital market

Funding of the PNFCs with the SF | Financing to the PNFCs by the EEFF reached $336,000 million as of December 2023, which represented a real drop of 15% in the semester and 25% in the year. Only the group of Other Commerce Chains increased its debt in both an annual and semi-annual comparison.

Irregularity of the PNFCs with the ESFFs | There were no significant changes in the irregularity of the PNFCs’ debt with the LFSE during the second half of 2023, which remained around 1% as of December 2023.

Funding of PNFCs in the capital market | In the second half of 2023, the PNFCs issued $193,000 million in financial trusts (at December 2023 prices), a six-month drop of 29% in real terms. The Fintech and, to a lesser extent, Sale of Household Appliances groups increased their share in 2023 compared to the previous year.