Robo.cash predicts 6pc growth in P2P volumes for 2023
Robo.cash has predicted that the European peer-to-peer lending market is likely to grow by six per cent this year, to reach €3.3bn (£2.91bn) by the end of 2023.
Robo.cash analysts have considered three possible scenarios for European P2P market development this year, concluding that the most likely scenario is that the market will see monthly growth rates of between 1.4 per cent and two per cent. This would result in a six per cent year-on-year growth.
“The main ‘fuel’ for the market can be the gradually weakening profitability of competitive assets: stocks, bonds, cryptocurrency, etc,” said the Robo.cash analysts.
Read more: What will P2P look like in 2023?
“The accumulated capital in 2020 and 2021 can be redirected by investors to other assets, for example, bank deposits. To suppress high inflation, central banks will most likely raise their rates. Under this model, we expect global average key rates to grow to 5.5 per cent by the end of 2023.
“P2P players can take advantage of this opportunity and increase their appeal.”
The analysts added that a protracted global recession would result in the worst-case forecast for the European P2P market. In this case, industry volumes may reach just €2.3bn in 2023 – lower than the first year of the Covid-19 pandemic.
“One of the main reasons for such a scenario may be the delayed reaction of central banks to inflation and the fall in people’s real incomes, which will force them to “uncover” their savings,” the analysts said.
Read more: Robo.cash adjusts interest rates
“Consequently, absolutely any assets will decline. The situation may be aggravated by the risks of further geopolitical escalation.”
Finally, the analysts predicted that in the best case scenario, European P2P would grow by between two and six per cent per month this year, to be worth €5bn by the end of the year. This would represent a 61 per cent increase, year-on-year.
“This optimism can be explained, firstly, by a possible slowdown in the growth of the DXY dollar index, which, in turn, will open up the possibility for other currencies to maintain their acceptable levels,” explained the analysts.
“According to our forecasts, world inflation will reach its peak by the middle of the second quarter of next year, after which it will rapidly begin to subside. Such an outcome can be realized through a systematic, but significant increase in key rates to the level of 7.3 per cent by the end of 2023. In turn, other assets will still fall, but slightly less than in the two previous options.”
Read more: P2P predicted to be among top assets of 2023