More Gen Z Hong Kongers taking up revolving line accounts

New accounts granted to them more than doubled.

Younger consumers are increasingly taking up revolving line accounts in Hong Kong, according to a study by TransUnion.

Millennials accounted for 40% of recent revolving line originations, whilst Gen Z representing over 30%. The number of new accounts granted to Gen Z consumers more than doubled, rising 127.8% in the three months ending November 2024.

“An increasing number of consumers in Hong Kong are using revolving lines from digital banks, reflecting greater product diversity in borrowers’ wallets,” said Weihan Sun, principal of research and consulting for Asia Pacific at TransUnion.

“Whilst we are seeing more consumers carry balances, those who revolve their balances may be doing so to take advantage of the lower interest costs on these facilities, compared to those on more traditional products like credit cards,” Sun said.

However, the rapid growth is also accompanied by a rise in delinquencies.

The percentage of accounts 60 or more days past due (DPD) was up 8 basis points (bps) year-on-year (YoY) to 0.7% at the end of November 2024.

“Whilst an increase in delinquencies may be of concern, it is in the context of remarkable growth in the adoption of a product that is disrupting the credit behaviours of multiple segments of consumers, particularly Millennials and Gen Z who prefer the speed and convenience of revolving lines,” Sun said.