Russians have gone into record-breaking loan debt since beginning of war

Russians spent 33.9% of the credit card available limit in August 2024.

Source: RBC with reference to information from the Russian credit history bureau Scoring Bureau

Details: Over a month, the rate of credit expenditure increased by 1.9% and became record-breaking compared with the beginning of 2022, when it was 31.6%.

Russians have been increasing the proportion of credit card limits used almost non-stop since August 2023. The average bill in the credit card segment reached its maximum in July at US$1,217.

Oleg Lagutkin, CEO of Scoring Bureau, states that Russians’ credit card spending has increased due to the rise in consumer prices.

In August 2.05 million new credit cards worth US$2.5 billion were approved for Russians. Compared with the previous month, the issuing of new credit cards dropped by 3.7% in quantitative and by 4.7% in monetary terms.

The year-on-year drop was even more tangible: the number of credit cards decreased by 20.9%, and the total approved limit by 11.6%. If January, when the demand for loans is seasonally low in the market, is not taken into account, the drop in issuing credit in August turned out to be the strongest since September-October of last year.

The Russian Central Bank reports that by the end of 2023, the number of credit card holders exceeded the number of citizens with consumer loans for the first time, reaching a total of 27 million people. Over a year the number of credit card holders in Russia has increased by 6.6 million people, or almost a third.

Background: According to the results in June, the total amount of Russians’ bank loans exceeded 40 trillion roubles (US$0.46 trillion).

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