Russia’s credit card market fell in August for the first time in five years “Kommersant” According to data from the United Credit Bureau (UCB).
According to the publication, in August 2024, banks issued 2,196 million credit cards to individuals for a total amount of 288.2 billion rubles. Both indicators were 5% lower than in July this year. This is the first August since 2020 when the segment showed a decline both in quantitative and monetary terms.
On the banks side, the credit card approval rate has decreased by half on average. Many financial institutions now prefer to provide consumer loans to their customers because they are more profitable in the short term.
Experts predict that the volume of issuance in this segment will decrease even further. Yuri Belikov, general director of the Expert RA rating agency, predicts that by the end of 2024 the volume of credit card issuance may decrease by 2-3%.
Part of the demand may shift to POS loans and BNPL (payment by installments) segments. The credit card market will be “taken over” by installment marketplaces and online stores, said Dmitry Yanin, Chairman of the Board of Directors of the International Confederation of Consumer Associations.
Before this, financial market participants criticized The draft law on the regulation of installment payments in Russia. Banks and BNPL services opposed the limit of the interest-free installment amount of 15 thousand rubles and suggested increasing the limit to 60 thousand rubles to cover more demanded goods.
For Russians before offered Introduce a waiting period before taking out a consumer loan.
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Source: Gazeta
Ben Stock is a business analyst and writer for “Social Bites”. He offers insightful articles on the latest business news and developments, providing readers with a comprehensive understanding of the business world.