Spanish consumer credit hits near 18-year high on economic boom

Consumer lending in Spain has hit levels not seen since the eve of the global financial crisis, reflecting both the Spanish economy's strength and a shift in focus from mortgages to more profitable but riskier credit among the country’s banks.

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Lending in Spain plummeted after the 2008-2009 crisis, but consumers have been emboldened by the Spanish economy, which has grown at double the rate of the European Union average this year with expectations it will outpace the bloc again in 2026.

"We still believe that there is more room for growth in consumer lending in a healthy way as the labour market is very solid," said Javier Gaztelu, deputy managing director and head of lending and payments at Sabadell.

Sabadell’s performing consumer loan book rose 19% year-on-year as of September, above a 5.6% mortgage loans increase.

Gaztelu said a jump in the workforce since the end of 2019 was driving lending, as an influx of foreign workers pushes Spain’s population to a near 50 million record.

New consumer loans reached almost 4.5 billion euros in October, a 21.8% year-on-year rise and the highest monthly total since 2007, official data shows.

That stands in contrast to the wider euro zonean ECB lending survey in October showed a moderate tightening for consumer credit because of concerns about the economic outlook.

Renta 4 analyst Nuria Alvarez said consumer credit would be a key driver for Spanish banking profitability in 2026, alongside corporate lending, asset management and insurance.

Unsecured consumer lending can be risky for lenders.