Car credit reaches five-year record

  • ECO News
  • 17 July 2017

In May, the Portuguese borrowed almost 252 million euros to invest in cars. It is the highest amount ever recorded by the Bank of Portugal, whose data goes back to the beginning of 2013.

Car credit continues accelerating and bringing up the total new consumer credit available from Portuguese banks and financial institutions. This goal in consumer credit reached in May a new record in five years, is disclosed by data from the Bank of Portugal.

According to the data shown by Carlos Costa’s entity, in May, banks and credit institutions granted a total of 251.5 million euros in loans for their clients to acquire a car. This is the highest monthly amount ever recorded by the central bank, whose data goes back to the beginning of 2013.

The intention of buying a car remains the main reason for the growth in the consumer credit, close to representing half of the total amount of that credit. Car credit increased almost 25% in comparison to the 201.3 million euros made available in April. When making an homologous comparison, there was a 31.87% rise in the granting of car credit.

This growth in credit granting with the aim of acquiring a car coincided with the month in which more cars were sold in Portugal: according to the Portuguese Automobile Association (ACAP), car sales had an homologous increase of 13.4% in May, corresponding to a total of 23,652 units sold.

In the remaining consumer credit categories, there was also an increase in the amount of loans granted. The personal credits for other purposes’ category was the second in which there was a larger increase in credit concession, rising 25.84% between April and May to a total of 227 million euros. Personal credits for education, health, renewable energies and for leased equipments (the least representative out of the total consumer credit) had a close to 40% increase, ascending to 4.7 million euros in May. On the other hand: credit cards and lines of credit, among others, had a 27.18% quarter-on-quarter increase, totaling in May almost 90 million euros.

In aggregate, the granting of consumer credit increased 25.75% in the same period to 572.2 million euros. Concerning the total of the year, banks and finance institutions granted a total of 2.6 billion euros in credit granting, corresponding to an almost 10% increase in comparison to the same period of last year.