Research Outline

PL Purchase


Identify and detail the types of triggers that determine WHEN (specific times of the year and/or certain periods in life) and WHY Australian consumers complete personal loan applications. These triggers can be purchase-related, functional, emotional triggers, timing related, etc. Some examples of reasons consumers may file an application for a personal loan may include but are not limited to: buying new vehicles, medical reasons, education, etc. This information should come directly from industry reports, as available, and will be used to help guide marketing for a neo-bank in the Australian market.

Early Findings

Reasons for Borrowing

  • According to a study published by Plenti, one of the most common reasons consumers in Australia file for personal loans is to consolidate existing debt.
    • In 2019, 37.4% of Boomers in Australia reported taking out a personal loan to consolidate their debts, compared to 37.1% of Millennials and 39.6% of Gen X.
  • Another common reason Australians are filing for personal loans is for home improvement projects.
    • Plenti's study found that about 20% of Boomers in Australia that took out a personal loan did so for a home improvement project, compared to 17.2% of Gen X and 12.6% of Millennials.
  • Purchasing a new vehicle is another common reason Australians are taking out personal loans.
    • According to Plenti, 14.1% of Millennials take out personal loans to buy their very first vehicle, compared to 12% of Gen X and 11.4% of Boomers.
    • Plenti's study made the assumption that the rates were lower for Gen X and Boomers, as they typically have access to other resources for obtaining a loan for a new vehicle, such as secured auto loans.
  • Medical expenses are a slightly less common reason that consumers in Australia take out personal loans.
    • In Australia, Plenti found that about 2.7% of Boomers will take out a personal loan to cover medical expenses, while only 2.1% of Millennials and 2.3% of Gen X will do the same.
    • The most common medical expenses that consumers are taking out personal loans for include dentistry, surgery (especially cosmetic), and urgent care bills.
  • Travel is a slightly more popular reason for taking out personal loans in the younger generations.
    • Around 8.7% of both Millennials and Boomers in Australia use personal loans to cover travel expenses, compared to 7.8% of Gen X.
  • In Australia, some consumers take out personal loans to cover the costs of weddings, with the average amount being around $36,000.
    • In 2019, 4% of Millennials reported to Plenti that they planned to take out a personal loan to cover wedding costs, compared to 2.1% of Boomers and 1.4% of Gen X.
  • Another reason that Australians report taking out personal loans is to invest in something.
    • Plenti reported that 1.8% of Millennials, 1.4% of Gen X, and 1.1% of Boomers are taking out personal loans to use as an investment because the loan makes the investment feel more tangible and less risky.

When Consumers Borrow