The monthly repayments are the main factor that Hungarians look at when considering whether to take out a loan to finance their plans. And for those who have been granted a loan by a financial institution in the past year, the total cost of the loan and how easy it was to borrow are the most important factors, according to a new survey.
The representative survey of 500 people by age, gender and region was conducted by Kantar in May 2023, the parent company of Provident Finance Plc., International Personal Finance (IPF).
The most important factor that Hungarians consider when considering taking out a loan is the size of the monthly repayment. This is the primary consideration for almost half of respondents (46.3%) when choosing which bank to borrow from in the latest survey.
The second most important factor is the interest rate, which is a factor for almost 40% (39.3%) of respondents.
Men and women weigh differently
What counts as the most important factor in a borrowing decision varies by gender. While men focus more on the interest rate, the total cost and the APR, women focus more on the monthly repayment rate and the type of interest (i.e. fixed or variable).
Men place more importance on the reputation of the lender, convenience and availability of a convenient mobile app, while women place more importance on the credit terms and speed of disbursement.
Generational differences - with a surprise
As for the different age groups, the youngest generation, aged 18-34, is the most likely to choose a loan offer based on whether the interest rate is fixed or variable. For 35–54-year-olds, the interest rate and the total cost are more important than for the other two age groups, while 55–75-year-olds also lead on two criteria: no one pays more attention to the monthly repayment rate or the APR.
Of the other criteria, 18–34-year-olds are most sensitive to credit terms and convenience. It is somewhat surprising, however, that the convenience of a mobile app is already more important to 35–54-year-olds, alongside ease of application, reputation of the lender and frequency of disbursement. For members of the 55-75-year-old generation, there is no aspect that is more important than for the other two age groups.
Other important factors for those who already have credit experience
The monthly repayment, total cost, interest rate, APR and ease of borrowing are more important factors for those who have borrowed from a financial institution in the past year. On the other hand, those who have recently become borrowers but have obtained a loan through other financial service providers rather than a bank pay more attention to whether the interest rate is fixed or variable, and how quickly they get their money.
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