Not more, but less: Russians have tempered their credit appetites

Russians have become more modest in assessing themselves as borrowers. Thus, they have significantly - by 10% - reduced the requested loan amount. If in 2023, on average, they wanted to get a loan from banks in the form of an unsecured loan of 632.5 thousand rubles, in 2024 - already 574.7 thousand, reported "Izvestia" in the marketplace "Finuservices" (service "Mosbirzhi"). And the process of revaluation continues - in January, citizens asked for an average of 523.7 thousand (minus about 10% more). This change is based on the Central Bank's tightening of monetary policy, i.e. increase of the key rate and limits for banks. This year experts expect a further rise in the cost of consumer loans, even if the regulator starts to soften the monetary policy.

Why borrowers are reducing the requested loan amounts

The regulator has been trying for a long time to get its policy to affect consumer lending. Borrowers did not give up in any way. However, they too have had to appreciate the rising interest rates and lower their loan amount requests. This, in turn, affected the market. As reported on Thursday, January 30, the Central Bank, unsecured consumer lending in December 2024 shrank by 1.9% after a near-zero result in November (+0.1%). The Central Bank explained: the main reasons for this were both high interest rates on loans, which banks raised following the key rate, and the regulator's toughening of requirements for wards to issue loans to people with high debt load.

This is confirmed by other data from the marketplace "Finuservices". So, said there, based on their information, the average approved rate on cash loans in 2023 was 14.9%, in 2024 - 22.4%. Which makes sense - the significant increase in the cost of borrowed funds has led to a higher monthly payment, and thus a higher debt burden. This is one of the reasons why people have begun to ask banks for smaller amounts, said Evgenia Lazareva, head of the People's Front project "For the Rights of Borrowers". According to her, even before the tightening of the CBA, citizens began to change their credit and savings activity. And the Central Bank's policy aggravated this process.

- In 2024, when making a loan application, borrowers began to look not only at the declared terms of the product and the rate, but to pay more attention to the terms of servicing obligations, their debt load and family as a whole. In other words, nowadays the consumer, realizing the cost of the loan and the probability of its approval, takes not as much as he wants, but as much as is necessary, will be issued and he will be able to service. And for the shortest possible and at the same time feasible term," the expert explained.

How the credit activity of Russians affected the market

In "Finusluga" confirmed that not only the requested amount is decreasing, but also the average term of cash loans in 2024: it decreased by 15.7%, from 44 to 38 months. Borrowers are gradually realizing that now is not the time to borrow impulsively, and you need to wait for lower rates, stressed Evgenia Lazareva.

The majority of experts interviewed by Izvestia agree that high interest rates and tougher requirements for lending to borrowers with debt load (debt load indicator - the share of income spent on servicing obligations. - Ed.) 50+ are the main reasons why people ask banks for less money in advance than they would like to receive. And all in order to adjust their needs to the requirements of creditors. Ilya Zharsky, managing partner of the Veta Expert Group, also suggests that high inflation, which has led to a decline in real incomes, has had its effect.

- Potential borrowers have become more cautious in accepting long-term financial obligations, preferring to request smaller amounts to reduce the risk of possible insolvency in the future," he commented.

Yuri Belikov, Managing Director of Expert RA rating agency, expressed a dissenting opinion. He emphasized that the decrease in the amounts requested by borrowers does not mean that banks will not give more in the end, primarily due to the inclusion of insurance and other additional payments in the body of the debt. The actual average amount of lending has hardly decreased significantly, but maybe, on the contrary, increased, he suggested.

However, in this case, the market is unlikely to have cooled down. And citizens could hardly find such conditions attractive. At the same time, based on the data of the Central Bank, the growth rate of consumer lending in 2024 fell from 15.7% to 11.2%. And as Mikhail Polukhin, Director of ACRA Financial Institutions Ratings Group, predicts, in 2025 the growth of the portfolio of unsecured loans is unlikely to exceed 10%, unless the regulator's policy of limiting the growth of citizens' borrowing is softened. At the same time, the key rate will affect the cost of loans to a lesser extent, he believes. Ilya Zharsky expects that this year the market growth is unlikely to exceed 5-7%.

Should we expect higher rates in 2025?

Will the population's requests for amounts in loan applications continue to decrease and loans themselves become more expensive? A representative of ACRA believes that interest rates on loans will show a noticeable increase during this quarter. He specified that an important role here is played by the regulator's abolition of the restriction on the full cost of credit (TCC) from January 1 to March 31. The expert is sure that banks will use this moratorium to compensate for the yield on loans after last year.

To put it simply, in 2024, against the backdrop of the key rate hike, banks increased the promised yield on deposits in order to attract funds from the population, while the cost of credit was limited by the relatively low maximum possible TCOP, which the regulator set under the more lenient MPA. Therefore, the gap in the cost of attracted (deposits) and placed (loans) funds was growing. The moratorium on the PSC will untie their hands. And the importance of the key in this process will change.

- We can assume that the growth of interest rates on consumer loans is currently less dependent on the movements of the key rate, that is, at least at the end of the current quarter it will be observed even in the case of softening of the DCP, - said Mikhail Polukhin.

Ilya Zharsky has a similar position, but he notes to a greater extent the factor that banks will want to insure themselves and put into the rates the risk of default on the part of borrowers who took money at high interest rates in 2024. Indeed, according to the Central Bank, last year the growth of problem loans amounted to 0.5 p.p. (from 4.1% to 4.6% of the portfolio). In addition, the expert has no doubt that the rates will be affected by macroeconomic factors, including geopolitical tensions and possible new sanctions restrictions, which is reflected in their interest rate policy.

The press service of the Central Bank confirmed that the rates in the market can change even at a stable level of the key rate, as they are affected by the cost of borrowing, various expenses of banks, and competition in the market.

- But we do not comment on the forecast level of rates, - emphasized in the Central Bank.

Konstantin Borodulin, managing director of ratings of financial institutions of the NRA rating service, puts the cost of loans this year in dependence on the quality of the loan portfolio. However, he does not expect a significant further increase in rates while maintaining the key rate. Banks will try to balance between compliance with regulatory requirements, maintaining the volume of lending to maintain margins and maintaining the quality of the retail loan portfolio, he emphasized