MAY 2004

Our Changing Market

Markets for credit in the U.S., as for other consumer goods, have changed dramatically over the past decade. According to the article by Sandra Yin in the most recent issue of American Demographics, "the foreign-born population in the U.S. rose to 31 million people in 200l, up by 57 percent from 1990."

The challenge posed for those in the consumer credit industry is much greater than for the retailer selling men’s shirts. The retailer can readily make the sale, so long as the consumer presents cash or a valid credit card. However, a lender is faced with a much greater problem. It is difficult, if not more risky; to grant a loan, or issue a credit card, to a person newly arrived in the U.S. and who has little or no credit history.

Fortunately, for credit grantors who might seek to market their services to foreign-born residents, the newcomers tend to cluster in a few states and cities. The table below shows the states with the largest percentage growth in foreign-born population.

Source: American Demographics, March 2004

To sharpen our focus, the same issue of American Demographics provides data on the clustering of young Hispanics (18-24 years of age) in 15 of our major cities. For example, the table below shows the population growth for young Hispanics in the six major cities where the growth rate of young Hispanics exceeded 20 percent during the period, 1990-2000.

Source: American Demographics, March 2004