1 saving, borrowing and paying in finland spring 2013

1

SAVING, BORROWING AND PAYING IN FINLAND

Spring 2013

2 © Federation of Finnish Financial Services

Coverage

2,399 (aged 15 to 74)

Sample is large enough to be reliable

Representative random sample, Finland in miniature

Time of interviews: February 2013, exactly one year after previous survey

Interviewed by: IRO Research Oy

SURVEY

3

Cannot say

Income is exceeded by expenses, using savings to cover expenses

Income is exceeded by expenses, must borrow to cover expenses

Income equals expenses

Income exceeds expenses

0 10 20 30 40 50 60

1

2

7

33

57

% of respondents (n= 2,399 in 2013)

CURRENT FINANCIAL SITUATION

© Federation of Finnish Financial Services

Which of the following statements describes your financial situation?

4

2013

2012

2011

2010

2009

2008

2007

2006

2005

2004

2003

0 10 20 30 40 50 60 70

59

59

56

56

58

55

52

52

51

46

37

% of respondents

SAVINGS AND INVESTMENTS


Do you hold savings or investments at the moment? ”YES”

5

Endowment policies

Voluntary personal pension policies

Listed shares

Mutual fund units

Current account

Savings or investment account

0 5 10 15 20 25 30 35 40

6

10

16

19

31

37

5

10

15

18

29

37

6

12

17

19

29

34

8

9

15

18

27

34

6

9

13

17

26

34

2009 2010 2011 2012 2013

SAVINGS AND INVESTMENT VEHICLES


Which of the following vehicles do you hold?

% of respondents (n= 2,399 in 2013)

6

SAVING AND INVESTMENT CRITERIA


How much was your choice of savings or investment vehicle impacted by the following factors? % of respondents (2.399 in 2013)

7

1999 2001 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 20130

10

20

30

40

50

60

4846

51 5250 51 51 51 50 49 50

53 53

24 2325

28 29 2931 30 30

2830

32 3128

3033 34 34 33 32 32

2830 30

33 33

12 11 11

6 6 7 6 6 5 5 5 6 7

Loan Home loan Consumer credit Student loan

CREDIT SITUATION


% of respondents (n=2,399 in 2013)

Do you hold a loan or credit at the moment?

8

2013

2012

2011

2010

2009

2008

2007

2006

2005

2004

0 2 4 6 8 10 12 14

10

9

7

11

9

10

11

12

12

13

BORROWING PLANS


Are you planning to take a new loan or credit during the next 12 months? ”YES”


9Source: Federation of Finnish Financial Services: Saving and borrowing in Finland, Spring 2013

30 years

26-29 years

25 years

21-24 years

20 years

16-19 years

15 years

11-14 years

10 years

6-9 years

1-5 years

0 5 10 15 20 25 30

4.9

0.5

21.0

3.1

24.1

6.3

13.0

3.6

8.9

3.1

8.0

HOME LOAN REPAYMENT PERIOD IN 2013

% of home loans taken during the last two years Average repayment periods :

2013: 17.9 years

2012: 17.4 years

2011: 17.8 years

2010: 17.4 years

2009: 18.5 years

2008: 18.8 years

1998: 11 years

10

1999 2000 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 20130

10,000

20,000

30,000

40,000

50,000

60,000

70,000

80,000

90,000

100,000

20,300

30,20035,800

42,00044,900

49,800

58,300

65,30071,500

76,50081,800 82,000

85,50089,500

AVERAGE HOME LOANS


Respondents who currently have a home loan (n=741 in 2013)€

How big is your home loan at the moment?

11

2007

2008

2009

2010

2011

2012

2013

Less than €40,000

€40,001-60,000

€60,001-100,000

€100,001-150,000

0 20 40 60 80 100

71

72

76

74

71

73

75

49

65

79

85

% of respondents who had raised the loan within 2 years (n=224 in 2013)

HOW MUCH OF HOME PURCHASE IS FINANCED WITH LOAN, BROKEN DOWN BY LOAN SIZE


Roughly how many percent of your home purchase was financed with loan?

12

2004 2005 2006 2007 2008 2009 2010 2011 2012 20130

5

10

15

20

25

30

35

2523 22 22 22 22 22 22 21 21

2527 28 28 28 28 29 28 28 29

Loan Housing loan

RATIO OF DEBT SERVICE COSTS TO DISPOSABLE INCOME


Approximately, how many percent of your monthly net income is used for instalments and interest on loans?

%, covers those who have loan of any kind (n=1,268 in 2013) or housing loan (n=741 in 2013)

13

Cannot say

Repaid later

Repaid sooner

Repaid according to plan

0 10 20 30 40 50 60 70 80 90

9

11

9

71

6

9

10

75

7

9

9

75

7

9

9

74

7

7

10

76

2009 2010 2011 2012 2013

CHANGES IN REPAYMENT PLANS



"Have you repaid the loans according to the original plan or have you made changes to the original repayment plan?"

14

Value of home falls

Savings or investments lose value

Temporary layoff

Unemployment

Loss of personal household income (e.g. illness, work disability, divorce,

death of a family member)

Some risks seen as threat

No risks seen as threat

0 10 20 30 40 50 60

9

8

12

22

32

54

46

8

12

9

19

26

49

51

2012 2013

RISK FACTORS IN PERSONAL FINANCES


Which of the following risk factors do you see as a threat to your financial situation? % of respondents (n=2,399 in 2013)

Breakdown of individual risks:

15

Other

Global situation, recession

Financial problems in household

Loss in value of home/changes in property prices

Health factors, illness, death

Interest rate rises

Work-related factors

0 10 20 30 40 50 60

8

4

4

6

9

46

31

12

13

6

6

13

48

31

2012 2013

RISKS AFFECTING HOME LOANS


What risks do you think may affect your housing loan?% of those who see risks that may affect their housing loans (n=140 in 2013)

16

2001 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 20130

5

10

15

20

25

30

35

40

2022

26 26 27 28 28 28 2724

2725

3436 37 37 37 37 36

3235

33

Loan Housing Loan

LOANS COVERED BY LOAN INSURANCE


Are any of your loans covered by payment protection insurance which secures repayment of the loan?% of respondents who have a loan (n=1,268 in 2013) or housing loan (n=741 in 2013)

17

Yes

0 5 10 15 20 25 30

24

27

22

22

21

2009 2010 2011 2012 2013

% of holders of home loan or consumer credit from bank (n=950 in 2013)

INTEREST RATE CAP


Do you have an interest rate cap on your loan to ensure interest payments stay within the agreed limit? Are you going to have your interest rate capped to protect against rate rises above the agreed?

18

over €80.000

€40.001-€80.000

€20.001-€40.000

€10.001-€20.000

Less than €10.000

Loan Size:

2013

2012

2011

2010

2009

0 10 20 30 40 50 60 70 80 90

83

72

71

55

40

72

79

75

77

68

PREPARING FOR INTEREST RATE RISES


Are you prepared for possible interest rate rises which would raise the cost of servicing your housing loan?

% of respondents who have a housing loan (n=741 in 2013)

19

2013

2012

2011

2010

2009

2008

2007

2005

2004

2003

0 10 20 30 40 50 60 70 80 90 100

93

90

90

88

86

84

82

76

71

64

7

10

10

12

14

16

18

24

29

36

Yes No

USE OF INTERNET


Do you use the Internet?% of respondents (n=2,399 in 2013)

%

20

At bank office

Payment service with service envelope

Payment ATM

Direct debit

Online bank

0 10 20 30 40 50 60 70 80 90 100

1

2

2

7

86

2

2

4

8

81

2

3

3

8

81

3

4

6

9

74

5

6

13

9

64

16

13

39

14

23

29

20

40

16

10

39

30

16

9

4

1994 1999 2001 2005 2010 2011 2012 2013

TYPICAL WAYS OF PAYING INVOICES


of respondents (2,399 in 2013)

What is the most typical way you pay your invoices?

21

ATM

Bank office

Shop cashier

0 20 40 60 80 100

89

4

1

1

18

6

90

22

7

Other types Total


CASH WITHDRAWALWHERE DO YOU MOST OFTEN WITHDRAW CASH FROM?

HOW ELSE DO YOU WITHDRAW CASH?

6% of Finns almost never withdraw cash

Banking cards suitable for cash withdrawals:• 97% of Finns have at least one• Even in the age group of 70 years or

older, more than 90% have at least one

22

2013

2012

2011

2010

2009

2008

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

41

33

29

26

22

15

58

66

70

73

78

84

1

1

1

1

1

1

Yes No Cannot say

RECEIVING INVOICES ELECTRONICALLY


% of those who pay invoices online

Do you receive e-invoices to your online banking site?

23

2013

2012

2011

2010

2009

2008

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

20

20

16

22

17

22

66

68

71

66

71

67

15

13

13

12

12

11

Yes No Cannot say

APPROACH TO ELECTRONIC INVOICING


Would you like to get e-invoices to your online banking site?

Of those who pay invoices online but do not receive e-invoices (1,273 in 2013)

24

2013

2012

2011

2010

2009

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

37

28

25

21

17

28

29

31

30

31

21

23

21

23

20

9

11

10

11

9

5

10

13

16

23

Already use e-invoices Yes, very aware Yes, somewhat awareHave heard about it Do not know at all

AWARENESS OF ELECTRONIC INVOICING


Do you know what an electronic invoice is?

Of respondents (2,399 in 2013)

25

Other

Credit card

Visa Electron card

Debit card

Cash

0 10 20 30 40 50 60

2

5

13

52

26

1

4

13

54

28

1

6

11

53

28

1

5

9

52

32

1

8

10

45

35

2

5

8

49

37

2008 2009 2010 2011 2012 2013

PAYING FOR DAILY SHOPPING


How do you pay your daily shopping normally?

% of respondents (2,399 in 2013)

26

Yes, only from Finland

Yes, only outside Finland

From both Finland and abroad

Neither

0 20 40 60 80 100

27

2

30

41

27

3

39

31

Spring 2013 Spring 2011


ONLINE SHOPPINGHAVE YOU PURCHASED GOODS OR SERVICES ON THE INTERNET?

27

Online payment / bank identifiers

Credit card

Paper invoice / credit transfer

Debit card or Visa Electron

PayPal

Other

Cannot say

0 20 40 60 80 100

63

46

30

17

11

4

1

69

42

32

19

14

1

1

Spring 2013 Spring 2011

% of respondents who had bought goods or services on the Internet(n=1,653 in 2013)

PAYING FOR ONLINE SHOPPINGWHICH OF THE FOLLOWING PAYMENT OPTIONS HAVE

YOU USED WHEN SHOPPING ONLINE?

1 saving, borrowing and paying in finland spring 2013

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