2023-09-05 07:32:06
Families go on vacation and pull consumer credit at the same time that they reduce their savings in deposits. Thus, the closing data for the month of July handled by the Bank of Spain (BdE) show that this type of financing continues to rise and has increased between June and July alone by more than 2,000 million euros. In fact, if one compares the month of July of the last few years –the first in which Spaniards go on vacation in a general way–, it can be seen that this year marks maximum consumer credit since 2009 and in the historical one is only surpassed by the years 2008 and 2007 – just before the real estate boom exploded and when credit conditions were far from current ones.
The arrival of the summer season causes spending to skyrocket, even more so in a summer in which vacation prices are setting records and families have been making efforts for months with daily expenses and their increase as a result of inflation in the last year and a half. With this situation as a backdrop, Spanish families have opted for consumer credit –one of the resources they continue to use to finance themselves despite the rise in interest rates– and the outstanding balance of this type of financing exceeded at the end of the seventh month of the year, 97,349 million euros. Thus, this figure is 3.9% higher than that of just a year ago, when it barely exceeded 95,000 million.
And all this despite the fact that this type of financing has become extremely expensive in recent months, widely exceeding 10% interest in recent weeks. Of course, companies of all types of products are making it easier to contract this type of financing through products such as buy now, pay later or startups and fintechs that are committed to breaking up short-term payments.
But the boom in consumer credit does not seem to be enough to cover these expenses, which have increased and families have chosen to reduce their savings at the same time. Thus, on the deposit side, as this newspaper published a few days ago, the bite to savings has also been noticeable, reaching 984,800 million euros at the end of July, compared to 990,300 million in one month. before. In the same month a year earlier, this amount was around 997,000 million, that is, the savings in deposits of families would have been reduced by 1.2%, or what is the same, just over 13,000 million euros. .
Mortgages continue to decline
Where the rise in interest rates has had an impact is in the contracting of other types of financing, such as mortgages, which have stopped almost dead in recent months while early repayments have increased to avoid the blow of a recalculation of quotas. Thus, according to data from the Bank of Spain, at the end of July the outstanding balance of housing loans was just over 500,000 million, a figure that has fallen by almost 20,000 since the same month of the previous year.
On the side of loans “for other purposes”, as indicated by the banking regulator, the outstanding balance has also been reduced, from 87,000 to 85,000 million.
Companies, with low credit
Beyond families, the rise in interest rates has also affected companies. In fact, the demand for loans from non-financial companies has fallen to its lowest level in 20 years, for as long as there are records. The demand for loans and lines of credit is not only the lowest ever recorded, but the fall is widespread in all sectors, according to the latest Survey of Bank Loans published quarterly by the European Central Bank (ECB) and which it takes as a reference June data.
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