During the second half of 2025, the consumer (non-bank) lending market remained stable in terms of the number of licensed service providers, while the volume of loans issued continued to grow. Over the course of the year, licensed lenders granted consumer loans exceeding EUR 1 billion, and the total credit portfolio reached EUR 1.4 billion by year-end. Growth was primarily driven by leasing and distance loans, while activity in the consumer loan and mortgage loan segments declined.
As of 31 December 2025, 38 special permits (licences) for the provision of consumer lending services were in force in Latvia, the same number as on 30 June 2025. During the second half of 2025, 37 companies granted new loans to consumers, two more than in the first half of the year.
Zaiga Liepiņa, Director of the Consumer Rights Protection Centre (CRPC), emphasises:
“Data on the consumer non-bank lending market show that the sector remains stable overall, with both lending volumes and the quality of the credit portfolio continuing to grow. This stability is closely linked to consistent supervision, adherence to responsible lending principles, and timely protection of consumer interests. Therefore, it is critically important that the supervision and protection of the consumer lending sector remain within the competence of the CRPC, ensuring a unified, specialised, and consumer-focused approach.”
Credit Portfolio Continues to Grow
As of 31 December 2025, the total consumer credit portfolio of non-bank lenders reached EUR 1.4 billion.
This represents an increase of EUR 181.13 million, or 14.86%, compared to 31 December 2024. Compared to the position two years earlier, the portfolio increased by EUR 339.99 million, or 32.07%.
The annual growth of the credit portfolio was primarily driven by distance loans and leasing transactions. The distance loan portfolio increased by EUR 178.13 million, or 37.53%, while the leasing portfolio grew by EUR 25.56 million, or 4.75%.
Significant Increase in New Lending
In 2025, licensed consumer lenders concluded 1.14 million new lending agreements, issuing loans worth more than EUR 1 billion in total.
Compared to 2024:
- The number of transactions increased by approximately 78,500, or 7.41%;
- The total amount issued increased by EUR 191.61 million, or 23.6%;
- Leasing recorded the highest growth in lending volume (+31.91%), followed closely by distance loans (+31.88%);
- Performing loans continued to account for a high share of the portfolio, with 95.89% of loans having no significant payment delays.
The summer and autumn months were particularly active. From July to October, the volume of loans issued exceeded EUR 90 million per month.
Different Trends Across Lending Segments
Distance loans increased both in terms of number and value during 2025. The total amount of distance loans issued reached EUR 550.04 million, an increase of 31.88% compared to 2024, while the number of transactions grew by 22%.
The volume of leasing, rental, and other loans secured by vehicles or other assets reached EUR 309.39 million, representing an increase of 31.91% compared to the previous year. The number of transactions rose by 20.34%.
The volume of consumer loans declined by 15.86%, while the number of transactions fell by 22.29%.
The volume of mortgage loans decreased by 12.76%, and the number of transactions declined by 22.80%.
Loans secured by a movable pledge increased by 4.36% in value, although the number of transactions decreased by 10.40%.
Interest Rates and Portfolio Quality
Overall, the quality of the credit portfolio remained stable.
As of 31 December 2025, the share of performing loans remained high, with 95.89% of the industry's credit portfolio free from significant arrears.
Portfolio quality improved during the year in the leasing and distance lending segments, whereas a slight deterioration was observed in the consumer loan and mortgage loan segments.
Interest rate developments varied during the second half of 2025. While interest rates on leasing agreements with variable rates declined during the first half of the year, they increased again in the second half, rising by 0.21 percentage points by December compared to June. An increase was also observed in leasing agreements with fixed interest rates.
The growth in consumer lending volumes should be assessed in the context of increasing consumer income and purchasing power. In recent years, both the minimum wage and the average salary have increased significantly. During the comparable period, lending growth was slower than wage growth. Furthermore, growth has been observed not only in distance loans but also in leasing transactions, which are predominantly linked to vehicle purchases.
Lending should not be viewed as inherently negative. What is important is ensuring that credit is not granted to consumers who cannot afford to repay it. CRPC statistics indicate that the quality of the sector's credit portfolio remains good overall, with 95.89% of loans classified as performing according to the methodology used by credit institutions.
CRPC Encourages Consumers to Borrow Responsibly
Before taking out a loan:
- Carefully assess whether you genuinely need the loan and whether you will be able to repay it;
- Compare several loan offers and their annual percentage rates (APR);
- Always read and carefully review the contract terms, ensuring that you understand the service and the repayment conditions;
- Know your rights – if you repay a loan in full before the end of the contract term, request a review of the total cost of credit and reimbursement of any overpaid amounts, where applicable.