Higher delinquencies or the client’s risk profile could be behind this situation
MADRID, 24 Mar. (EUROPA PRESS) –
Interest rates on consumer loans in Spain are double those of France and Belgium, although they are shortening distances with Italy or Portugal, which move at similar levels, according to a report prepared by iAhorro.
In loans of between 1 and 5 years there is a clear difference between Spain (7.01%), Portugal (6.58%) and Italy (6.01%) on the one hand, and Germany (4.46%), France (3.65%) and Belgium (2.78%) on the other.
For its part, in loans over five years, Portugal maintains an average interest rate of 7.61%, surpassing Spain in this case (6.97%).
Behind are Italy (6.89%), Germany (6.24%), and France or Belgium, among other countries, which are far from these numbers with an average of 3.37% and 4.68%, respectively.
The iAhorro expert Antonio Gallardo explained that December closed with a strong rise compared to the previous month that may be consolidated in the coming months if the default rate rises.
Thus, in loans of 1 to 5 years, it has gone from 6.61% in November, to 7.07% in December, with a rise of 0.46%, while in loans of more than five years it has gone from 6.63% to 7.24%, 0.61% more.
Although, for the moment, this does not seem to have been reflected in the first known data of this year. Interest rates on financing for consumer goods and services have gone from 7.07% in December 2020, to 7.01% in January 2021 in loans of 1 to 5 years, and from 7.24% to 6.97% on loans over 5 years.
The director of the master’s degree in Financial Risks at ICADE Business School, Luis Garvía, explained that if the delinquency rate in Spain (4.54%) is compared with that of France (2.47%), it would be logical that lending money in the first country it is more expensive than in the second.
In general, the interest that banks apply in exchange for lending money is usually closely related to the bank delinquency rate, since it represents the risk they assume.
The latest data released by the Bank of Spain for January 2021 placed it at 4.54%. “It is logical that the interests of these loans are above other European countries where the delinquency rate is less high, especially if we do not have any type of guarantor, such as a home in the case of a mortgage,” he said .
However, Garvía also considers that other variables have an influence, such as the client’s risk profile or the fact that there are more financial agents in the market, which causes banks to carry out fewer operations, but with higher commissions.
–
