Less Russians can afford early repayment of their debts

Credit bubble will burst soon

Number of early repayed debts decreased in Russia in comparison with previous year. According to National Bureau of credit histories (NBCH), only 22,7% of debtors repayed their loans early, which is lesser than 1.7% from 2018. This tendecy continues for a second year in a row.

Even automobile loans, which showed better repayment statics than average, showed 4,9% decline. 3.2% loss suffered early payments on unsecured loans.

Among the reasons behind such trend was pointed out drastic decline in financial security of fellow compatriots, where 40% of people consider themselves poor, and overall increase of debt burden on citizens. All of this leads to “overheating” of the market, which can lead to far worse outcomes.

Credit organisations blaming this trend on a customers, that after declining of lending rates doesn’t have a motivation for early repayments that happened in 2018.

In fact, this tendency is beneficial for banks, because they continue to receive money, especially after revising of lending rates. To “compensate” themselves they creat new systems of prolonging time to pay, which in the long run will cripple national economy to such extent, that even high-ranking government officials recognized this problem. Yet greedy bankers, only interested in profits here and now couldn’t care less about the consequences.

Current situation with money lending in Russia demonstrates another sign of downfall of capitalism. Only way to destroy this vicious cycle of man-made crisises is to change current economic and political order into more progressive, which will protect interests of majority of people, and not a bunch of fat cats, imposing their will on a wholes society.

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