Against a backdrop marked by the impact of rising interest rates, Luxembourg's retail banks continued to support their customers in 2022 by adapting to changes in their behaviour. The ABBL annual study of the retail banking market shows a clear return to favour for term accounts and, from the beginning of 2023, a drop in loan applications. The trend towards digital solutions is also confirmed.

Rising interest rates: a change in the landscape

In order to curb inflation, the European Central Bank (ECB) proceeded, in successive stages, to a sharp and rapid increase in interest rates.

Renewed interest in term accounts

Term accounts rose by 300%. This figure is directly attributable to the appeal of these low-risk products against a backdrop of rising interest rates.

Credit demand down since early 2023

Lending activity remained buoyant in 2022, with a 5% increase in volume. The contraction in demand for loans, particularly property loans, which began in the third quarter of 2022, accelerated at the start of 2023.

The trend towards digital solutions continues

COVID has accelerated the digitalisation of banking services, particularly payments. In many areas, Luxembourg is at the top of the European league when it comes to new behaviours and acceptance of innovative solutions.



Head of Payments, Innovation and Digital at the ABBL.

ESG: the great challenge of the future

The world of finance is in permanent evolution. Among the changes that will impact the habits of bank customers, the ABBL has chosen to highlight the Environment, Social and Governance (ESG) aspects, which pose new challenges but also offer new opportunities for everyone.