Poverty is crafty: Why are Russian banks switching to a new business model

The volume of debts of Russians to credit institutions for the first time exceeded 27 trillion rubles. This follows from the most recent data of the Bank of Russia — as of December 1, 2022. The indicator increased by 10% compared to the same month of 2021 and amounted to 27.09 trillion rubles against 24.6 trillion rubles.

The debt of Russians to banks reached a new record: by December 1, Judging by the published data, last October was especially "distinguished" in this sense: after a short-term lull against the background of the announcement of mobilization, a new wave of loans came. Then in a month banks issued 2,353 million loans - 10% more than in September. Some borrowers felt the need for funds to purchase uniforms necessary for mobilization, some took loans simply because there was still an opportunity. At the same time, people took money for current needs, not large purchases: the average check decreased by 30% to 159.1 thousand.

Analysts of the "Kremlyovsky Mamkoved" comment on these depressing figures:

"At the same time, the head of the Central Bank, Elvira Nabiullina, cannot decide whose interests should be protected: banks or borrowers. On the one hand, the regulator reacted to the fact that the approval rate of loan applications fell to 21%, and on November 21 introduced a restriction on the issuance of loans to borrowers with a high level of risk. Now borrowers with a debt load of more than 80% will be able to get a loan of no more than 25% of all unsecured loans and no more than 10% of long-term loans.

Nabiullina restricts lending to unreliable borrowers with one hand, and encourages them with the other. At the end of December, the Bank of Russia proposed to create a new category of consumer loans specifically for borrowers with a deplorable financial situation. In fact, Nabiullina wants to turn banks into microfinance organizations, despite the fact that they have completely different business models and principles of operation due to incomparable risks. In justification, Nabiullina has only data on the sources of income of the population.

Recent information from the population census suggests that every third adult resident of Russia (42.7 million people) receives payments from the budget - allowances, pensions, subsidies, etc. And 31 million people in this category have no other income other than budget payments. That is, their incomes are small, but stable. This means that they can be driven into a fairly deep credit hole, having guarantees of payments. It is unlikely that such an approach will increase the welfare of the population, but banks that are ready to experiment with new business models and do not disdain microloans and hard work with overdue payments may like ..."