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Argentine Household Debt Jumps to $5.6 Million Per Borrower as BCRA Cuts Rate

The central bank is loosening policy to curb borrowing costs following a rapid expansion of nonbank lending alongside rising delinquencies.

Overview

  • Average debt per indebted client reached $5.6 million in July, up 75% year over year, with about 6.2 million people owing across bank and nonbank channels.
  • Per borrower, balances average roughly $4.4 million with banks plus $1.2 million with nonbank lenders, according to the BCRA’s PNFC report.
  • Delinquency climbed to 8.6% overall, while nonbank liabilities show 15% arrears, including 20% in personal loans, 27% in appliance financing, and 18% in digital wallets.
  • Borrowing costs remain extreme, with a 129% nominal annual rate on nonbank personal loans and about 92% on bank credit cards, far above inflation.
  • Outside the banking system, 542 firms hold around $11 trillion pesos in loans after strong growth, and the BCRA has eased reserve rules and reduced the reference rate from 22% to 20% to lower lending costs.