Personal loans at pre-crisis levels

 In News

The amount of personal loans being taken out by Portuguese consumers has risen to pre-crisis levels according to the Bank of Portugal.

The central bank particularly highlights the number loans used for buying cars in line with an increase in car sales.
For the first time credit levels have exceeded the levels seen in 2010 before the troika arrived in Portugal.
However, the Bank of Portugal points out that the costs in terms of interest on the loans is significantly higher than before the crisis.
According to the Retail Banks Markets Monitoring Report 2018, a monthly average of 39,759 personal finance contracts were signed last year — a growth of 10.1%.
The use of loans encompasses loans for education, for domestic appliances and home furnishings, holidays, or even to meet financial needs.
“For the first time, the average number of new personal loans exceeded the amount recorded in 2010 (38,122 contracts)”, states the Bank of Portugal, whose data reveals that last year was the sixth consecutive increase of this type of loan.
In 2011, the number of new contracts was on average 30,591 per month, a contraction of 20% on the previous year, 2011 being the year in which Portugal sought financial support from the troika of international lenders.
In 2018 all told, individuals and families took out €3.1Bn in personal credit while the total amount of credit granted to consumers increased to 42.9% (It was 42.2% in 2017).
“In terms of the number of contracts signed, the percentage relating to personal credit finance also increased (from 28.8%, in 2017, to 30.9%, in 2018)”, the report states.