The Ukrainian PDL Market 2020 – Overview From SalesDoubler

What is happening with the Ukrainian PDL market 2020? In short, he begins to revive. It is impossible to make accurate predictions of the future with absolute certainty as everything depends on many uncertainties and factors that can change over time. We hope for the best.

However, it can be safely noted that the Ukrainian PDL market, like other markets, was “hit” by the COVID-19 pandemic. This global process has significantly changed the economic situation in the country. Many have lost their jobs or their income has dropped significantly. On the one hand, this is bad for PDLs, because not every Ukrainian is able to repay a loan, and some are simply afraid to “go into debt” in unstable times. On the other hand, the pandemic has accelerated digital transformation and increased the demand for online financial services, which can become the basis for the development of PDLs specializing in this area.

Will the Ukrainian PDL market 2020 be able to Recover to the Level of January-February This Year?

We realized that the PDL market is best known by the best microfinance organizations that have been lending to the population for many years. Therefore, we collected the most painful questions and asked representatives of key PDLs in Ukraine to answer them.

What consequences of quarantine can we see?

The PDL market suffered greatly during the quarantine period. The reasons are clear: job losses and a shortage of borrowers’ regular income. Consequently, we witness a 40% decrease in demand for microcredit services, as well as on arrears growth almost by 2.5 times. We will show one example for you to understand how arrears influence the work: before the quarantine we, theoretically speaking, had around 15 000 clients without active up to one-month credits, now we have around 7 — 8 000. Part of these clients simply ceased to use the services of PDL during the quarantine, and most of them simply failed to pay on time and don’t rush to call in their credits.

MYCREDIT

The corona crisis, legislative initiatives of PDL and also toughening of banks policy regarding crediting for consumer needs are the factors that impact growth of the market. If client cannot solve issue in a bank – he comes to PDL.

Money4you

How Long Can the PDL Market of Ukraine 2020 Recover?

Full recovery of the market up to the level of January-February 2020 is expected in August-September.

MYCREDIT

The market will recover when clients’ demand recovers and people get back to work!

ShvidkoGroshi

The market will be restored approximately in March 2021.

KF.UA

We are looking forward to further recovery of the microcredit market. We expect rates to be the same during 2-3 months.

MONETKA

We forecast that during the next two months, we will get back to about eighty percent of the rates followed by large amounts coming from the affiliates. However, it is possible that someone will set prices higher than during the pre-crisis period, as business models also have kids to feed and traffic is needed although it is scarce.

Top Credit

Our forecast on the market recovery: from the beginning of the autumn it’s optimistic, till the end of the year it’s realistic.

Global Credit

In March-April we reacted to this uncertain situation and made a series of adjustments in decision-making regarding credit issuance. To put it simply – we started reducing credit issuance. But now we get back to the pre-crisis level.

Creditkasa

We already observe that the main players returned to 0% crediting. At what time can this happen? We think not before August.

E-cash

We think that up to the end of the year, we shall have approximately the same figures.

KUMO

Let’s check the market drawdown statistics in general. In our perspective and according to different sources (CB, Payment – providers, Google Trends etc.) it’s clear that the market had around 50-60%  drawdown compared to January – February 2020. Это ощущается соответственно в объеме получаемого трафика.This can be seen in the volume of the traffic received. It’s hard to tell by the pace of recovery. It mostly depends on the factors mentioned above. In our opinion, the market will return to its previous state in three months.

Credit Plus

In the second half of 2019 the market was bloated, the prices of CPA for credit were not just. We assume that the prices will increase to 500 UAH which matches the market and target price, although we don’t expect any significant growth till September. The market is constricted by around 2-3 times, in summer there will be a drawdown as per usual. Perhaps a small volume of traffic on the market will have an impact on the rates increase. But again, it will not be a market price for PDL and it’s unclear whether anyone agrees to that – those who act like this last year had investors’ money and were pursuing their own goals.

MyWallet

Market demand for our services didn’t decrease. But all the participants have a conservative approach nowadays. Those who were crediting for loaned funds ceased such activities. Besides, during the quarantine period, the penalties for overdue credits are not applied. That’s why the forecast for the market is: till the end of the year the companies that do crediting at their own expense will restore the volumes. By the end of the next year, the companies that do credit for loaned funds will restore volumes. In other words, the market will recover by the middle of the next year.

Moneyveo

The market is likely to recover to the previous level as per CPS rates during the next 2-6 months. As for the volumes, according to Google trends, the demand for online credits as at the middle of May 2020 had more than 50% drawdown and conversion no less than 20%. It means that we shouldn’t expect the previous volumes in the nearest future.

Credit7

There will return to the previous rates but not in the nearest future. We think it’s about 3-4 months. In a very optimistic scenario – 2 months.

Money4you

What are the main factors that will help restore the Ukrainian PDL market in 2020?

The main factor that will help in PDL market recovery is the start of enterprise work in Ukraine. It is difficult to specify how many people will be left without regular income after quarantine termination. But one should understand that regular income is an important criterion when making decisions on the issuance of credit.

MYCREDIT

The indicators of a full recovery will be normal functioning of public transport and the cancellation of the laws that «allow» borrowers to not pay their credit.

Now PDL will try to detect a new profitable client. It’s impossible to tell how profitable a new client is because it’s too early.

Without understanding of profitability PDL are not able to pay 800 UAH per client. At the same time portfolio should be maintained, that’s why PDL will first provide loans for their clients again, and when they are no longer available – they will switch to the market.

Objectively speaking, It would be smart to attract new paying clients after the ban of  imposing fines / penalties but PDL won’t be waiting. Some of large PDL may show a «bad» example (fix a high interest rate for a lead) and all the others will follow it. The prices for client will start growing again which is premature and bad for the PDL market but good for the affiliates market.

Mister Money

The market already shows the tendency of returning to the pre-crisis levels. One can notice that by looking at zeroes of the first loan and increasing payments. Although the trend of «credit online» pattern has plunged significantly. Certainly it has something to do with the fact that people are afraid of taking the credits as they won’t be able to pay them off.

Top Credit

Important factors are the quarantine, unemployment rate, further autumn pandemic outbreaks, the way NBU will regulate the PDL market, commonplace IMF tranches etc.

KF.UA

We are working on the improvement of business processes with the goal to optimize issuance and reduce clients’ defaults. We rapidly perfect scoring process.

E-cash

The main factors that will have impact on market recovery and development:

• NBU as a regulator from 1^st of July –  regulations of rates ( so far no prerequisites), clients authorization (can significantly impact SR), fulfillment of advertisement terms;
• PDL control on behalf of new regulator
• PDL presence in media channels (TV + Digital) – making demand in media observed in the  4^th quarter of  2019;
• Natural recovery of demand on PDL products – the end of the quarantine;
• Risk reduction – jobs recovery, going to work and clients returning to normal life.

The only silver lining is that market recovery (the same legislative situation as now) – will start not from the scratch.

Credit Plus

The market may recover but under certain conditions. If you take into account the current dynamics, a full recovery is expected approximately in October. AmongstIhe factors we can outline two: final end of the quarantine and recovery of small and medium-sized businesses capacities.

SOS CREDIT:

The key factors that will impact the dynamics of the market are:

• Cancellation of quarantine restrictions and, correspondingly, growth of economic activities. Those diligent clients returning to work will definitely stop being afraid of taking credits.
• The quarantine crisis aftermath. A share of population will be in need of additional money between paychecks.
• TV and other advertisements. During the quarantine microcredit organizations ceased most of their activities which resulted in a slower flow of incoming clients to the market. The wide-range advertisement is – the higher is demand.
• Possible restrictions related to the change of regulator. One can only hope for the best here.

Credit7

Everyone felt the market decline. The forecasts say from 2 months to a year and a half for recovery to the previous volumes. Everybody needs media advertisement and the population wants to get back to normal life.

How will your strategy change in the new reality?

In crisis situations, a plan is very important. We asked our PDL if they have clear options for action that will speed up the restoration of microcredit to the population in Ukraine. We were struck by the preparedness of companies for different conditions. But the general trends are: reducing the cost of attracting a client, searching for new reliable borrowers, working to return funds, and traffic profitability.

During the previous two months the borrower’s image has completely changed (both in a good and bad way). Consequently – the acceptable cost of attracting a new client has changed.

We are building marketing from scratch per se. The only thing that remained unchanged is the advertisement tools.

With all this going on it’s important to understand that the main goal of company and marketing, during the quarantine in particular, is not attracting new clients but refunds. Today we are working on the second quite important objective – attracting «high-quality» clients, in other words, potential borrowers capable of taking financial obligations on credit in contractual terms.

MYCREDIT:

It’s simple. We do the crediting and search for a new profitable segment of clients. We will be doing it more actively as soon as we find one.

Mister Money

Coronavirus and quarantine have taken their toll; many clients lost their income and were late on their mortgage on two or more credits.

Naturally, we cannot credit them and increase the financial burden now. 20 to 30% of our clients ceased to pay their credits.

The №3329-д  adopted by Verkhovna Rada also had its impact regarding ban of assessing fines and penalties. Initiators that want deeper legislative regulation of microcredit market in Ukraine also became more active.

Monetka

The bullet points concerning the strategy:

• Change of the risk model on the assumption of increasing number of default clients;
• Research of the financial behavior of new and steady clients during quarantine;
• Cutting costs for leads’ attraction;
• The highest priority of the objectives that may lead to the conversion increase.

Global Credit

The market will recover. There’s no exact forecast if it comes to time – too many unknowns. When can this happen? We think no sooner than August. The main factors that had and will be having an impact on the market are quarantine and limits related to it, clients’ default, consumer sentiment, and NBU.

Creditkasa

We limited the number of credits issued. The clients proven reliable are in high priority.

KUMO

Business attention is focused on restoring the previous volumes with respect for all legal provisions, increase of attraction efficiency, providing conditions for restoration and development of work of the partners CPA) and internal channels for attraction. We also work on conversion development and risk reducing. As for CPA, during quarantine period Credit Plus proceeded with crediting clients and didn’t remove its affiliate program even for a day.

Credit Plus

Expenditure minimization and risks reducing, scoring, cutting off default clients, collection enforcement.

MyWallet

We became very careful when issuing credits, more often we adapt scoring to new practicalities. We thoroughly count money and invest funds into the most efficient channels.

Moneyveo

We are constantly working on updates to our scoring model, and we also simplify signing-up procedure for clients and plan a new release. This will certainly increase CR and EPC affiliate programs. For us СРА-traffic will remain a high-priority channel for getting leads, after quarantine termination we will also be considering work with the CPA network as a priority.

Money 4you

we make an emphasis on working with risks, thorough growth with the lowest number of defaulters possible.

KF.UA

The strategy transforms rapidly. We launched a national campaign on TV, Youtube and radio in May – that’s the way of making demand.

ShvidkoGroshi

About working with CPA networks after the quarantine. We cannot make hundreds of websites in SEO and arbitration teams don’t make themselves, the same thing about making money. In the current situation, the income of affiliates is more important than that of networks. We assume that balance is inclined towards perks for affiliates, and networks should maximize the automatization of work with approves/payments/conveniences. And there’s still hope that even more affiliates will start accordingly counting eCPC and CR (which also depends on the network used and the amount of data updated). Résumé: CPA channel is quite a channel indeed 🙂

As for returning to the previous volume of credit issuance (we work for application), absolutely everyone is dependent on payment discipline/populism in legislation/transition to National Bank / financial source. The growth of amount of issuances will come along with economic revitalization with about a month or two delay.

Crisis always stimulates brains and improvements, that is why everyone will have their AR higher than before after recovery (they will learn to work in a new way and finish off the old schemes).

Will validity criteria be toughened? It’s about additional sources of client validation – photo of passport, photo of a person with a certain text. It depends on National Bank. They recently had an intention to implement video identification. Imagine that, you show your passport to Meizu 3 via the front camera. Now all the toughenings are related solely to the clients’ risks.

MILOAN

What should affiliates expect when working with your affiliate program in the nearest future?

Of course, we are concerned about the work of affiliates with Ukrainian PDL market. Therefore, we asked top microcredit companies how they see the future of the PDL market and how conditions in offers can change. Can affiliates expect stable work? Will there be high stakes? Will eCPC and CR grow? The answers, to be honest, were pleasantly surprised.

Our marketing strategy does not change, at least till recovery. Then we shall seriously consider the image aspect of our brands. I suppose that the fact that step by step we are promoting scoring and client conveniences goes whiteout saying 🙂

Top Credit

As before we guarantee full timely payment to affiliates. Moreover we are going to launch an action which is very juicy with regard to payments in the nearest future. That’s in addition to the current rates of bonus network.

Creditkasa

Yesterday the level of conversion of loan applications was close to pre-quarantine period one.

E-cash

The situation will be improving in time, we continue to work and increase the number of insurances. Perhaps we will increase the price of conversion as well.

KUMO

We can point out:

• Previous stability – we are not a company where one day conversions work well and the other day don’t 🙂
• Increase of CR – on an ongoing basis we are searching for the ways of improving conversions of funnels (the registration steps) and AR with decrease or saving the rates of default.
• The support of the top EPC. As always we do everything possible to provide the most favorable terms when cooperating with affiliates.
• We are also working out an action for affiliates – so keep posted)

Credit Plus

The objective was and remains as following: loan portfolio growth. For the further growth we set 0.1rate for the first 7 days – this works well with CR application. Drawing credit is very simple (both via website and application) – CR application on the traffic from the context reaches 50 %. Now CR isn’t bad for affiliates, 3-5% which makes the affiliate program quite interesting. The rate will be increasing.

My Wallet

In the nearest future we are increasing affiliate program conversion.

Moneyveo

 We increased issuance, which can be seen even now (both CR and consequently EPC are growing). Such an image will remain stable provided that the profile of the clients does not change in the nearest future.

SOS CREDIT

If we speak about the strategy itself – nothing has changed. If we speak about tactics and plans, the only thing left is to put our ears to the ground and react to the market fluctuations as fast as possible. These fluctuations are quite volatile.

Our principles of working in CPA networks remain the same: providing of top eCPC, high conversion and stable performance.

Credit 7

At the end of this week the Money4You affiliate program will show rates increase. Join and try it yourself!

Money4You

The rejection of partners’ network is basically impossible. Reducing of client attraction cost on CPA market has cut a share of traffic due to low profitability of the previously developed bundles. Only those with minimal traffic cost price remain. We are continually working on the growth of eCPC and CR, we will start properly increasing rates when possible.

Global Credit

As always we will do our best to fulfill our obligations, we’re open to any criticism and get better on terms of conversion.

Top Credit

We really value affiliates that manage to get us traffic and clients even in harsh market conditions. We want rates to be stable, we have a stable CR – yes, it’s lower than before the quarantine, but now the client is not that good and scoring is more complicated. We have a plan to return the scoring settings to the previous rates as soon as the quarantine ends. We will increase the rate as soon as possible. This will naturally increase eCPC.

Monetka

We haven’t ceased crediting. Since the beginning of the quarantine we were crediting only our clients (recurring) though. The results indicate that the given segment is in a plus field. Now we try new leads but free of charge (our own SEO). I suppose till the end of the month we won’t be buying. If we see that new clients are not much worse than the previous ones during the quarantine – we shall return to buying leads in June. For us the weighty indicator of market recovery is urban transport recovery and cancellation of the ban to charge delayed payments.

MR money

Growth of CR, ЕРС, new products and affiliate programs, payments twice a month.

KF.UA

We are ready for dynamic changes of the terms and raising stakes! Additionally we generate demand which increases affiliate program attractiveness!

ShvidkoGroshi

To date, on the MyCredit affiliate program we paid back a 0% loan, got an approve and activated work of finishing off the clients on the stage of unfinished registration. All of it should positively affect affiliates.

As for raising the stakes – we will do it bit by bit. Everything will depend on quality of traffic provided. We have always paid special attention to it, now it becomes a critical factor.

We would like to draw attention of our affiliates to the fact that work on the market during the crisis is a constant test. That is why it is important to make the decision whether you are ready to build up your traffic from scratch and adapt to new conditions. If yes – MyCredit affiliate program is ready to cut a deal and provide on-demand up-to-date information regarding reliable and non-reliable clients etc.

MYCREDIT

The Ukrainian PDL market 2020 has a future for affiliates!

Résumé for affiliates: the market didn’t die – that’s for sure! It has already started to recover, and the pace of growth/recovery depends on:

1. Quarantine and its timing,
2. Conscientiousness of borrowers
3. NBU as a regulator

And the main thing that joins together the feedback of advertisers – is that they value affiliates and are inclined to do (already doing) everything possible for traffic partners to have more gain in working with their affiliate program!You may also be interested in reading an article about the PDL market during the war