Banking
40s Age Group Dominates Personal Loan Applications Despite Rising Rates
In 2025, personal loan application activity hit previously unheard-of heights, reflecting both changing financial habits and growing challenges from the expense of living among middle-aged Australians. Despite rising borrowing costs, research indicates that people in their 40s are significantly increasing the nation’s appetite for credit.
Australians took out $9.04 billion in fixed-term personal loans in the June quarter of 2025, according to the most recent data from the Australian Bureau of Statistics. The largest percentage of all personal loan applications (31%), of any age category, came from borrowers between the ages of 40 and 49.
This increase has continued even as average unsecured loan interest rates have increased to 13.87% annually, indicating that personal credit solutions are becoming more and more necessary as financial commitments like mortgages, school bills, and family spending continue to outstrip income growth.
Demographic Analysis: Understanding the 40s Borrowing Surge
Personal loan applications are most common among those in their 40s (31%), followed by those in their 30s (25%), and those in their 50s (22%), according to data from personal loan provider Plenti. Australians under 60 make up only 6% of applications, and younger Australians make up only 15% of loans.
The typical borrower profile shows important trends. Forty-five percent of people who apply for personal loans are homeowners with current mortgages, and 46 percent make between $50,000 and $100,000 a year.
Financial companies like CashLend have noticed this change in the population, as evidenced by the steady increase in applications from people in the 40–49 age range in 2025. This group consists of people who have reached their maximum earning potential but are nevertheless dealing with significant debt on several fronts.
The 40-year-old demographic is in a special economic position. In addition to managing their mortgage obligations, these borrowers frequently support dependent children and, more often, elderly parents financially. This financial responsibility across generations and ongoing cost-of-living hikes put household finances under previously unheard-of strain.
Changing the Way People Borrow: From Optional to Necessary
Analysing loan reasons reveals significant shifts in how people borrow money. Consolidation accounts for 51.92% of all personal loan applications, suggesting that borrowers are looking to manage their current debts rather than finance new purchases. The last two key categories, which are categorised as necessary rather than optional, are car purchases and home renovations.
This change from lifestyle and investment borrowing to applications driven by necessity represents a substantial divergence from past trends. According to the trend, customers are being forced to consolidate their existing loans due to economic stress, which may be a sign of increased financial fragility among Australian households.
Record Borrowing Amid Rising Costs
The $9.04 billion borrowed in June 2025 excludes an additional $1.66 billion in refinancing activity. This represents sustained growth since June 2020 following pandemic-related contraction.
Key Figures:
- Average loan amount: $22,643
- Typical loan term: 35.4 months
- Average weekly repayment: $178
Regional variations provide additional insight into borrowing habits. Australian Capital Territory borrowers request the largest amounts at $30,388 on average. South Australian residents follow at $26,266.
Northern Territory borrowers request the smallest amounts at $19,168. These differences reflect varying economic conditions and cost structures across jurisdictions. The sustained growth despite high interest rates raises concerns about household financial resilience.
Understanding Current Interest Rates
Personal loan interest rates remain elevated compared to other lending products. October 2025 data shows secured loans averaging 9.65% while unsecured loans average 10.65%. Credit scoring dramatically impacts available rates. Borrowers with excellent credit can access rates near 9.79%. Those with poor credit scores (0-459 range) face rates approaching 25.25%.
The Reserve Bank of Australia reduced the official cash rate three times during 2025. Cuts occurred in February, May and August, bringing the rate to 3.60%. However, personal loan rates have not declined proportionally. Several factors explain this disconnect.
Personal loans carry higher risk profiles than secured lending products with no collateral backing the debt. Lenders also employ risk-based pricing models that assess each applicant individually. CashLend and other industry participants utilise sophisticated credit assessment frameworks. These evaluate multiple risk factors beyond base rate considerations.
Strategic Approaches for BorrowersCredit Score Matters
Your credit score represents the primary determinant of available interest rates. Prospective borrowers should obtain credit reports before making any application. Improving your credit score can generate substantial interest savings.
Maintaining consistent bill payment histories helps. Reducing credit utilisation ratios makes a difference. Correcting reporting errors proves valuable. Even modest score improvements can shift applicants into lower rate categories. This potentially saves thousands in interest charges over loan terms.
Comparison Shopping Is Essential
Personal loan application processes require strategic thinking. Each lender offers different rates based on their specific assessment criteria and risk appetite. Financial experts recommend obtaining quotes from multiple providers.
Typically three to five comparisons provide adequate market insight. Most lenders offer preliminary rate assessments through soft credit inquiries. These do not impact credit scores. This allows applicants to compare actual offered rates rather than advertised rates.
Critical Assessment Factors:
- Total borrowing cost including all fees and interest charges
- Comparison rates reflecting true loan cost
- Fee structures (establishment, monthly and exit fees)
- Flexibility provisions for additional repayments
- Early repayment terms and potential penalties
Warning Signs to Watch
- Certain lending characteristics warrant caution. Establishment and ongoing fees exceeding 5% of loan principal represent above-average costs.
- Pressure to borrow larger amounts than requested should raise concerns. Unclear fee disclosures or “guaranteed approval” marketing indicate questionable lending practices.
- Affordability assessment must extend beyond basic serviceability calculations. Stress-test your budget against potential income disruptions or expense increases.
Alternative Financing Options
Before proceeding with a personal loan application, evaluate alternative approaches. Homeowners with mortgage redraw or offset facilities may access lower-cost finance through existing home loans.
Balance transfer credit cards offering promotional interest periods can provide cost-effective debt consolidation. This works best for disciplined borrowers who can repay within the promotional timeframe.
Direct negotiation with creditors may yield payment arrangements or hardship provisions. This avoids interest charges entirely in some cases.
Support Resources:
- National Debt Helpline: 1800 007 007 (free financial counseling)
- No-interest loan schemes for essential purchases
- Low-interest loan programs targeting low-income households
- Community organisation assistance programs
Looking Ahead
Market analysis projects continued growth in Australian personal lending. Forecasts indicate potential expansion to $13.16 billion by 2034. This represents a 23% compound annual growth rate. Digital lending platforms continue gaining market share. This may drive increased competition and improved rate offerings for consumers.
The current trend toward essential rather than discretionary borrowing appears likely to persist. Cost-of-living pressures show no signs of easing in the near term. As millennials transition into their 40s, demographic factors may further increase demand. This could intensify competition for creditworthy borrowers among lenders. Regulatory oversight of responsible lending practices continues strengthening. Increased focus on affordability assessments and suitability determinations aims to protect consumers.
Conclusions: Navigating Complex Lending Decisions
Not greater prosperity, but broader economic stresses are the reason behind record personal loan application volumes among Australians in their 40s. Despite RBA rate cuts, average rates are still high at 13.87%, meaning that borrowers must pay a high price for loans.
When applying for a personal loan, potential borrowers should take a calculated approach, comparing offers from several lenders, getting thorough credit evaluations, and carefully weighing their options. Free counseling programs and expert financial help are excellent resources for complicated borrowing decisions.
Economic challenges, high borrowing prices, and demographic considerations all combine to make life difficult for Australian households. To effectively manage debt while preserving long-term financial stability, careful comparison, realistic affordability assessment, and informed decision-making are still crucial.
By Adedapo Adesanya
First Holdco Plc has commenced a public offer to raise about N1.4 trillion (approximately $1 billion) after securing approval from the Central Bank of Nigeria (CBN).
The offer, which opened on Monday, involves the sale of 10.4 billion ordinary shares, according to the chief executive of its banking subsidiary, First Bank of Nigeria Limited, Mr Olusegun Alebiosu.
The capital raise follows the company’s earlier plan to transfer about a quarter of its shares to RC Investment Management Ltd., which served as a bridge holder after Barbican Capital Limited exited its investment in the lender amid a prolonged ownership and leadership dispute.
First Holdco had previously indicated that the shares would eventually be offered to the investing public once the necessary regulatory approvals were obtained.
Speaking in an interview with Bloomberg, Mr Alebiosu said proceeds from the offer would strengthen the capital base of First Bank and support the holding company’s expansion strategy.
According to him, the group intends to diversify beyond banking by establishing an insurance underwriting business and a fintech services company.
“The sale is starting today — the reality here is that I am not sure it will stay more than one week based on the pressure we are getting,” Mr Alebiosu said, expressing confidence in strong investor demand.
Investors appeared to respond positively to the announcement, with First HoldCo’s shares climbing as much as 5.9 per cent to a record high during trading on Monday before easing to a 3.1 per cent gain at N133.60 by early afternoon in Lagos.
The lender has been one of the best-performing banking stocks on the Nigerian Exchange (NGX) Limited over the past year, with its share price rising more than fourfold since July 2025, when Barbican Capital’s stake was transferred to RC Investment Management.
The fresh capital injection comes as its largest shareholder, Mr Femi Otedola, continues to strengthen his stake in Nigeria’s oldest bank. With the billionaire holding around a 26 per cent stake in the company, analysts say he has his eyes set on full control once his equity crosses the 30 per cent mark.
By Adedapo Adesanya
One of Nigeria’s top digital banks, PalmPay, has appointed a former executive of the Nigeria Inter-Bank Settlement System (NIBSS), Mr Samuel Oluyemi, as its chief operating officer.
In his new role, Mr Oluyemi will oversee the financial technology company’s operations in Nigeria, where it offers a broad range of digital financial services to individuals and businesses.
Mr Oluyemi will also engage with regulators to ensure the company’s expansion aligns with Nigeria’s financial, digital and social inclusion objectives.
Prior to joining the company, Mr Oluyemi spent more than two decades at NIBSS, where he served as business development lead.
During his tenure, he drove the development of several critical payment infrastructure projects, including the digital validation of Nigerian international passports, e-Dividend Mandate Management System (e-DMMS), and the Electronic Pensions Contribution Collection System (EPCCOS).
Also, he played a key role in the introduction and early adoption of the NIBSS Instant Payment (NIP) platform, Nigeria’s first real-time interbank transfer system launched in 2011, and later supported its extension to other financial institutions.
Mr Oluyemi obtained a master’s degree in Monetary Economics from the University of Ibadan and has participated in several local and international professional training programmes.
Commenting on the appointment, Managing Director of PalmPay Nigeria, Mr Chika Nwosu, said that the company was strengthening its leadership team to support its longterm vision.
By Adedapo Adesanya
Africa’s most valuable fintech, Flutterwave, has signalled that its long-anticipated initial public offering (IPO) remains firmly on the back burner as the company intensifies efforts to transform itself into a licensed financial institution across the continent.
The firm’s chief executive, Mr Olugbenga Agboola, said the firm is focused on building sustainable profitability, diversifying its revenue streams and expanding its banking footprint before considering a stock market listing.
Speaking to The Africa Report, Mr Agboola described an IPO as a future financing milestone rather than an immediate strategic objective.
“An IPO is a financing event, not a strategy,” he said. “We are not holding any pressure to go public. This gives us the flexibility to be patient and ensure when we do list, we’re doing so from a position of strength.”
The comments come as Flutterwave embarks on an acquisition-led expansion strategy aimed at securing banking licences and deeper regulatory access across Africa.
Mr Agboola revealed that the company is currently in the process of acquiring a bank in East Africa, though he declined to disclose the institution or country involved.
The planned acquisition is expected to provide Flutterwave with an established customer base, existing banking infrastructure and regulatory approvals, significantly shortening the time required to enter new financial services markets.
According to Mr Agboola, the company’s expansion priorities include Kenya, Ghana, Rwanda, Tanzania, South Africa and Egypt, while the Democratic Republic of Congo and Ethiopia remain under consideration for future growth.
Rather than building banks from scratch in every market, Flutterwave intends to adopt a mix of acquisitions, licences and strategic partnerships depending on local regulatory conditions.
“The vision is not to form a bank in every country but to ensure that every African business has access to more than financial services,” Mr Agboola said in the interview.
The banking push follows recent regulatory and corporate developments, including the Central Bank of Nigeria’s approval of Flutterwave’s banking licence and the acquisition of open banking startup Mono.
Together, the moves underscore a broader strategy to expand beyond payments and establish new revenue streams in lending, liquidity management and business banking services.
Flutterwave plans to focus on institutional deposits from businesses already using its platform rather than competing aggressively for retail deposits.
The company intends to leverage transaction data from its payments network to provide short-term working capital, merchant financing, invoice discounting and trade finance products for small and medium-sized enterprises.
Mr Agboola disclosed that the bulk of the capital earmarked for banking operations will be directed toward credit support and liquidity buffers, with additional allocations for lending and banking infrastructure.
The strategy reflects a growing trend among African fintech firms seeking banking licences to reduce dependence on traditional financial institutions and gain greater control over settlement, liquidity management and product development.
Despite speculation about a near-term public listing, Mr Agboola maintained that Flutterwave’s immediate focus remains execution and growth.
He noted that the company will only consider an IPO after achieving stronger profitability and establishing scale across its payments, banking and remittance businesses.
In February 2025, he told Bloomberg that Flutterwave would only pursue a public offering after becoming profitable. He also stated in late 2024 that the company was “not in the IPO race.”
Founded in 2016, Flutterwave has processed more than one billion transactions valued at over $40 billion across 35 African countries. The company recently secured fresh funding that lifted its valuation to $3.3 billion, with American blockchain firm Ripple leading the investment round.
For now, however, Flutterwave appears more interested in building the foundations of a pan-African financial institution than rushing to the public markets, positioning banking expansion as the next phase of its growth story while keeping an eventual IPO firmly on the long-term horizon.
