In spring 2022 unsecured consumer loans in Russia showed only a slight decline. Higher rates, increased risk and broader market uncertainty deterred many borrowers. The Central Bank pointed out that tight lending standards and a high key rate limited demand for expensive loans among affluent borrowers, while criteria were tough for less wealthy citizens seeking credit.
Nevertheless, the summer brought a cautious revival in the consumer loan market. The Central Bank’s June banking sector report noted a small uptick in loan volumes for the first summer month, rising 0.2% after a three month slide. A drop in June interest rates and banks easing their lending stance helped spur demand as the market adjusted from the earlier decline in May, April, and March.
What are the big banks saying?
Customers across several Russian banks have reported more frequent messages about higher credit limits on cards since late July. Reporters with socialbites.ca observed similar offers. Large banks ranked in the top thirty by capitalization confirmed the trend.
Otkritie Bank noted that unsecured consumer loans are expanding in the market.
“Since the start of the second quarter, Otkritie Bank has consistently increased its credit card sales each month, with June marking a record for issuance. In the second quarter, demand for cash loans rose by about one third compared with the first quarter. While there is no plan for a global rise in limits for loan products, changes may occur for certain borrower categories that could affect limits”, an official stated.
MTS Bank reported that while deciding on new credit cards, it also adjusted existing limits for current customers. “The forecast has improved versus spring, so limit adjustments are expected to be positive”, the bank’s press office commented.
RNKB Bank indicated regular growth in credit card limits for cardholders. The more a customer uses the card, the higher the chance of a larger available limit.
“Limits, solvency, activity, and overdue prevention are assessed separately for each client. Increases can range from 10% to 100% of the current limit”, a representative explained.
For customers with a steady income from a debit card, the increases tend to be the strongest. RNKB highlighted payroll holders, retirees and the self-employed among those benefiting from higher limits.
Sovcombank also enabled higher credit card limits, with Halva cards now available to clients. The limit is reviewed regularly and can rise with active use. The bank can also increase the available funds upon client request.
Post Bank saw a sharp rise in credit card demand at the start of summer. The average payment amount grew as well.
“In June, the bank’s credit card portfolio expanded by 46% year over year. Compared with May, loan demand climbed by 56%. As loan volumes increased, the average payment size rose by about 10% per month”, the bank’s communications noted.
Will loans become more affordable?
Alexei Volkov, Marketing Director of the National Bureau of Credit History, spoke with socialbites.ca about slightly higher average credit card limits. In June 2022 the average limit stood at 70 thousand rubles, up from 69 thousand in May.
“Compared with May, the average limit size is up 1.4%. Compared with the same period in 2021, the average credit card limit has grown by 2.8% (May 2021 saw 68.1 thousand rubles). In 2021 and the early part of 2022 limits hovered around 70-75 thousand rubles. Today those indicators are gradually moving toward pre-sanction levels”, he noted.
Igor Nikolaev, a principal researcher at the Institute of Economics of the Russian Academy of Sciences, cautioned that the falling trend in bank rates is unlikely to continue into autumn. He warned that such a shift could limit credit availability.
“The recent reductions in the base rate by one to three percentage points have made loans more attractive, but any sustained gains will be offset by stagnant real incomes and lingering inflation. The risk of loan nonpayment by year end may rise significantly.
The ruble weakened further against the dollar, and higher inflation could come from increased parallel imports. The current level of the key rate is likely to remain near the lower bound”, he concluded.
These evolving conditions illustrate how banks balance risk, demand, and policy changes to tune credit availability for diverse segments, including those with regular income streams and those relying on card-based limits. The broader trend shows lenders gradually expanding access while maintaining prudent oversight in a changing economic landscape.