Increasing Demand for Credit among Hungarians

The financial situation of the Hungarian population is slowly improving, and with it the willingness to take out loans has also started to increase, according to data from a national survey commissioned by Provident Financial Ltd. Although demand for credit has fluctuated over the past few years, along with consumer confidence, both are currently on the rise, with two-thirds of Hungarians considering taking out a smaller loan.

42% of Hungarians see it as a possibility and a further 24% are preparing for it, so overall 66% of the adult population is open to taking out a loan of between HUF 40,000 and HUF 1.5 million. According to the results of the annual national survey commissioned by Provident Financial Services, although consumer confidence and willingness to borrow have fluctuated in recent years, the financial outlook now seems to be stabilizing, reflecting a cautious increase in confidence, which is also reflected in the growth of demand for credit.

In the category under review (i.e. among adults with an average per capita income below HUF 300,000), the proportion of those reporting an improvement in their financial situation is increasing, albeit slightly. Compared to October 2023, when 48% of respondents said their financial situation had worsened, by December 2024 only 37% felt this way. The proportion reporting an improvement, meanwhile, rose from 13% in 2023 to 18% at the end of 2024, double the 2020 result.

The financial expectations of the public also appear to be more balanced, as the large swings that were previously present in forecasts have disappeared. 26% now expect their situation to improve, a minimal change compared to 2023. It is interesting to note that Romania has the highest share of those expecting an improvement compared to the rest of the region, while Hungary is the clear leader in terms of the share of those planning to take out loans. 

The share of those planning to take out loans shows much more significant fluctuations. While in 2020, 39% said they would definitely not need credit and almost as many (38%) considered it possible, in 2022 the figures were 24% and 49% respectively, by 2024 the two figures are much closer again (33% and 42%) and overall, those planning or considering taking out a loan are now in a significant majority (66%).

The most common credit purpose is currently to cover health-related costs, with 39% of respondents indicating this in a multiple-choice response. 38% would borrow to cover expenses related to home renovation and maintenance, while financing unexpected expenses was cited by 36% of respondents. This pattern of borrowing goals appears to be a consistent trend: in surveys conducted since 2017, the three goals above have always been at the top of the podium, with at most their order switching in some years. The next band of frequency currently includes purchasing household appliances (28%), buying or repairing a car (22%) and covering current expenses (20%), with paying utility bills (20%) also being a relatively significant item. All other possible credit goals scored only single-digit percentages in recent responses, including investing in one's own microenterprise (8%).

Senior Commercial and Customer Experience Manager at Provident Financial Services, László Sulyok stressed that "the results of this survey confirm that the financial confidence of the population is improving and more and more people are looking for informed, well-planned solutions. Attitudes are also changing: the growing interest in small loans, especially to finance everyday life expenses, shows that people are increasingly looking at credit not as a crisis solution but as a tool, as part of conscious financial planning. At Provident, our goal remains to provide our customers with affordable, transparent financial solutions that are tailored to their life situations."