The average consumer loan amount in Russia dropped by 5.7% last month, reaching 152,300 rubles. According to the National Bureau of Credit Histories (NBCH), this is the lowest level recorded since last winter, as reported by RIA Novosti.
The NBCH attributes the situation to the Central Bank’s strict monetary policy, a view shared by Artem Deyev, head of AMarkets’ analytical department. He points out that both the average consumer loan size and overall demand for such loans have significantly declined. Last month, demand dropped by more than 20%, according to NBCH data. This is hardly surprising, as interest rates on unsecured loans can reach or even exceed 40%, making borrowing increasingly unattractive for citizens.
The decline in the average loan amount is also attributed to stricter measures that banks are mandated to implement for clients under the new regulatory standards.
“Since October, the Central Bank has imposed stricter limits on banks regarding borrowers with high maximum debt burdens (MDB). The allowable share of loans for those with an MDB above 80% has been reduced from 20% to 5%, while a 30% cap has been introduced for loans to borrowers with an MDB of 50% to 80%, who previously faced no such restrictions for unsecured loans. This has led to a higher rate of loan rejections and a decline in average loan amounts. When individuals approach a bank, they either adjust their loan requests to fit within these limits to avoid rejection, or the bank itself determines the maximum amount based on their credit history and income,” the analyst notes.
The expert predicts that the slowdown in the consumer lending market will persist until at least the second quarter of 2025, with both the volume of loans issued and the average loan size continuing to decline. While a brief uptick in lending activity might occur just before the New Year, driven by seasonal consumer demand, Artem Deyev expects it to last no more than two weeks.