Digital lending involves online lending where the entire process is automated using advanced algorithms and digital platforms. It provides quick and hassle-free access to credit for consumers and businesses. Customers can apply for loans online and the lending platforms use data analytics and alternate data sources to assess creditworthiness and sanction loans instantly. This has boosted financial inclusion. The global Digital Lending Market is estimated to be valued at US$ 538.99 Mn in 2023 and is expected to exhibit a CAGR of 26.9% over the forecast period 2023-2030, as highlighted in a new report published by Coherent Market Insights.

Market key trends:

The growing adoption of digital lending services across various industries has been an important trend in the digital lending market. With technological advancements like AI, machine learning and data analytics, digital lending platforms are able to analyze large amounts of data quickly for credit scoring and decision making. This has enabled faster loan approvals and disbursals. Digital lending platforms collect data from various digital footprints of customers like social media profiles, banking transactions, mobile phone usage etc. to build alternative credit profiles. This has expanded credit access to more customers including those with insufficient credit history. The ability of digital lending platforms to leverage new sources of data is expected to drive further growth in the market over the forecast period.

Segment Analysis

The global digital lending market is segmented by solution into lending platforms and lending analytics. The lending platforms segment held the largest market share in 2023 owing to growth in adoption by banks, financial institutions, and FinTech companies. The lending platforms segment provides a centralized platform for financial institutions to manage their lending operations. Features such as automation of loan origination and underwriting processes, disbursement management, and loan servicing help in optimizing operations and enhancing customer experience. The segment is expected to maintain its dominance during the forecast period.

Key Takeaways

The Global Digital Lending Market Size is expected to witness high growth over the forecast period of 2023 to 2030. Regional analysis shows that North America held the largest market share in 2023 attributed to presence of major digital lending players in the US and Canada. However, Asia Pacific is expected to grow at the fastest CAGR during the forecast period, primarily due to growing adoption of digital lending solutions among fintech companies and banks in China, India and Southeast Asian countries.

Key players operating in the digital lending market are On Deck Capital Inc., Lendingclub Corp., and Social Finance Inc. (Sofi). On Deck Capital Inc. focuses on offering lending solutions for small businesses. Lendingclub Corp. provides lending and financing solutions for both personal and business loans. Sofi offers personal loans, student loan refinancing, mortgage refinancing and more through its digital lending platform.

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