The Central Bank of Russia plans to explore more ways to restrict consumer lending in Russia, Deputy Governor of Central Bank Ksenia Yudayeva was quoted by TASS as saying.
The measures are supposed to be in response to the increase in unsecured consumer loans. As of the end of 2018, Russians’ loan payments went up by 28% year-on-year. According to the Equifax credit history bureau, the number of consumer loans issued in April 2019 alone was 1.3 mln, for the amount of over RUR 270 bln.
Starting October 2019, the Russian consumer lending market will be subject to new regulation, according to which banks will be required to take into account the prospective borrower’s debt load when issuing a loan. The debt load will, among other, affect the true interest cost. This approach will discourage banks from excessively issuing unsecured consumer loans.
Moreover, the Central Bank is currently considering additional measures to restrict the growth of consumer lending in Russia. The household debt overburden is not yet overwhelming, according to the Central Bank; however, there are socially vulnerable categories of customers.
President Vladimir Putin raised the issue of Russians’ debt load during the Direct Line on June 20.
“We do not need these bubbles in our economy,” he said.