The Polish non-bank loan market consists of two main but distinct product segments, each with its specific characteristics.
Purpose-Specific Loans
The first segment includes purpose-specific loans, which are characterized by their low loan amounts. The average value of newly granted purpose-specific loans in January 2025 was 644 PLN, representing an 8.9% decrease compared to the same period the previous year. These loans are issued to finance a specific purchase, such as goods or services, rather than providing the client with cash directly.
Purpose-specific loans can cover both small e-commerce purchases and higher-value loans for used cars or medical services. These loans are typically granted for short terms and are well-repaid, making them similar to installment loans offered by banks.
In January 2025, the number of newly granted purpose-specific loans increased by 24.9% year-on-year (y/y), while the total value of loans issued grew by 13.8% y/y. This indicates that lower-value loans were the primary focus, contributing to the decline in the average loan amount.
By January 2024, all purpose-specific loans had been fully reported, meaning there is no longer a distorted comparison base due to incomplete reporting. The dynamics recorded in January 2025 fully reflect the current market situation.
Cash Loans
The second segment in the non-bank loan market consists of cash loans, which are deposited directly into the borrower’s account and can be used for any purpose, including household budget support. Compared to purpose-specific loans, cash loans tend to have a higher risk of default and are typically issued for higher amounts.
This segment includes two types of cash loans: short-term, low-value loans (commonly known as “payday loans”), which are typically issued for up to 60 days, and high-value loans with longer repayment periods, often spanning several years. The latter type closely resembles bank cash loans.
The average value of payday loans issued in January 2025 was 2,487 PLN, marking an 11.7% increase compared to January 2024. The total sales value of payday loans in January 2025 reached 1.053 billion PLN, a 35.8% y/y increase. The number of payday loans granted also rose by 21.8% y/y. Payday loans accounted for 72.3% of the total value of all cash loans issued in January 2025.
In January 2025, cash loans with terms exceeding 60 days were issued in a total of 74,000 cases, amounting to 404 million PLN. Compared to January 2024, this represents a 19.1% increase in the number of loans and a 39.6% increase in total value. The average value of cash loans with terms over 60 days reached 5,497 PLN in January 2025, 15.5% higher than the previous year.
Similar to purpose-specific loans, full reporting of cash loans had already been implemented by January 2024, eliminating any distorted comparisons due to incomplete reporting. Therefore, the growth dynamics recorded in January 2025 accurately represent the market situation.
In January 2025, as in previous months, purpose-specific loans dominated the numerical distribution of non-bank loans, while cash loans accounted for the larger share in value terms.
The Growing Role of BNPL Transactions
An increasingly important segment of the Polish financial market is Buy Now, Pay Later (BNPL) transactions. In January 2025, 5.37 million BNPL transactions were recorded, marking a 21% y/y increase, with a total value of 931 million PLN, reflecting a 25% y/y rise.
Quality of Loans Issued by Non-Bank Lenders
A key aspect of risk management in the loan sector is the analysis of loans with delays exceeding 90 days, commonly referred to as non-performing loans (NPL). The sector has shown significant improvement in the 2024 and 2023 loan vintages compared to 2022. This improvement is a result of adjustments to new regulations concerning maximum loan pricing, mandatory creditworthiness assessments, and reporting obligations to the Credit Information Bureau (BIK).
Purpose-specific loans exhibit the best repayment performance, with a default rate of 1%, similar to bank installment loans. The situation differs for cash loans, whose quality varies depending on the loan term. Cash loans with terms of up to two months have a lower default rate (4%) compared to loans with terms exceeding 60 days (10%). The default rate of long-term cash loans is higher than that of bank-issued cash loans.
Alongside the improvement in default rates, there has been a notable improvement in the NPL ratio, which reflects the structure of the loan portfolio.
The overall quality of cash loans in the sector has improved in terms of overdue obligations exceeding 90 days. By the end of January 2025, the NPL ratio stood at 18.2%, six percentage points lower than the previous year. In the purpose-specific loan portfolio, this ratio remains significantly lower at 4.3%, with a slight y/y increase of 0.2 percentage points.
The NPL ratio is influenced by various factors, including default rates, the growth rate of new loan issuance, debt collection policies (whether firms sell receivables or conduct internal collections), and other operational strategies.
