Allied Market Research

2024

Credit Default Swap Market

Credit Default Swap Market Size, Share, Competitive Landscape and Trend Analysis Report by Type (Municipal Bond, Emerging Market Bonds, Mortgage-Backed Securities, Corporate Bonds, Others) and by End User (Individual, Enterprises): Global Opportunity Analysis and Industry Forecast, 2023-2032

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Author's: | Vineet Kumar
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A credit default swap (CDS) is a contract that allows two or more parties to transfer the credit risk associated with fixed income products. In a CDS, the buyer of the swap makes payments to the seller of the swap until the contract's maturity date. In exchange, the seller agrees to pay the buyer with security's value as well as all interest payments. Therefore, the increase in payment ticket size, easy accessibility of swaps, and the cost saved by the consumer is expected to boost the market growth of the credit default swap market in the near future.

The global credit default swap market is segmented on the basis of type, end user, and region. Based on type, the market is divided into municipal bonds, emerging market bonds, mortgage-backed securities, corporate bonds, and others.

On the basis of end user, the market is bifurcated into individual and enterprises. Geographically, the market is analyzed across several regions such as North America, Europe, Asia-Pacific, and Latin America, Middle East & Africa (LAMEA).

Top Impacting Factors

The rise in demand for cash alternatives and the availability of affordable and low-cost credit swap facilities are the major drivers of the market. Furthermore, developments in the forex trade and an increase in offshore investment as a result of adding funds fuel the growth of the credit default swap market. 

However, the lack of standardization is expected to hamper the market growth. Contrarily, new rules and regulations implemented by the government to stabilize the market and increase the number of internet users. Also, developments in the E-commerce industry are expected to provide lucrative opportunities for the market in the future.

The Rise in Demand For Cash Alternatives

According to a recent study, advisers are seeing an increase in demand for fixed income investments and clients want low-risk investments with higher returns than traditional cash-based swaps. The credit swap market reduces the risk of overspending because there is a time limit imposed. These swaps can be loaded quickly and easily through a variety of platforms, including bank account transfers, direct deposit, or cash, both online and in person. 

Furthermore, corporations are constantly looking for cash alternatives to manage their day-to-day transactions. According to the Federal Deposit Insurance Corporation, 6.5 percent of U.S. households were unbanked in 2018, implying that 8.4 million U.S. households are still operating in the economy without a bank account. Credit default swap cards enable unbanked consumers to conveniently access essential payment services. The company can also use this card to track expenses, fund cards, and details of interest amounts in real-time. All of these factors are fuelling the market growth.

Increase in the Number of Internet Users And Developments in the E-commerce Industry

The rapid growth of the e-commerce industry has compelled businesses to use credit default swaps rather than cash transactions in their wallets. According to several banks, the credit default swaps segment has been one of the key factors driving bills payable, short-term credit, and prepaid card sales globally. 

For example, the Dubai payments industry is undergoing significant change, with a large number of consumers abandoning their swap platforms in favor of a new payment tool known as the "credit default swap market". These cards can be used in place of credit default swaps and are easily accessible to non-banked businesses. As a result, the dominance of the market is expected to grow which creates lucrative opportunities for the market.

Key Benefits of the Repor

  • This study presents an analytical depiction of the credit default swap market forecast along with the current trends and future estimations to determine the imminent investment pockets.    
  • The report presents information related to key drivers, restraints, and opportunities along with a detailed analysis of the credit default swap market share.     
  • The current market is quantitatively analyzed to highlight the credit default swap market growth scenario.         
  • Porter’s five forces analysis illustrates the potency of buyers & suppliers in the market.    
  • The report provides a detailed credit default swap market analysis depending on the present and future competitive intensity of the market.

COVID-19 Scenario Analysis

  • The COVID-19 outbreak has had a moderate impact on the growth of the credit default swap market, as the adoption of swaps has increased in the face of unprecedented circumstances. The COVID-19 has significantly fueled the growth rate of the market. It also reduced human errors in recoding and summarizing transactions. For instance, the Reserve Bank of Australia, in its recent publication, stated that the COVID-19 may have only furthered the industry's shift toward default swaps.
  • In addition, the market players have introduced innovative credit swaps products by using the advance electronic platform

Questions Answered in the Credit Default Swap Market Research Report

  • Which are the leading players active in the credit default swap market?
  • What would be the detailed impact of COVID-19 on the credit default swap market size?
  • How the current credit default swap market trends that would influence the industry in the next few years?
  • What are the driving factors, restraints, and opportunities in the global market?
  • What are the projections for the future that would help in taking further strategic steps?

Credit Default Swap Market Report Highlights

Aspects Details
Credit Default Swap Market By Type
By Type
  • Municipal Bond
  • Emerging Market Bonds
  • Mortgage-Backed Securities
  • Corporate Bonds
  • Others
Credit Default Swap Market By End User
By End User
  • Individual
  • Enterprises
Credit Default Swap Market By Region
By Region
  • North America  (U.S., Canada, Mexico)
  • Europe  (UK, Germany, France, Spain, Italy, Rest of Europe)
  • Asia-Pacific  (China, Japan, India, Australia, South Korea, Rest of Asia-Pacific)
  • LAMEA  (Latin America, Middle East, Africa)
Key Market Players
Key Market Players

JPMorgan Chase & Co., Morgan Stanley, CREDIT SUISSE GROUP, Charles Schwab & Co., Citigroup Inc., Julius Baer Group, UBS, Goldman Sachs, Bank of America Corporation., Royal Bank of Canada

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Credit Default Swap Market

Global Opportunity Analysis and Industry Forecast, 2023-2032