The Corona crisis has Europe more firmly under control again – and people’s worries are growing again, especially when it comes to the future of their own financial situation. And it is understandable, because rent, electricity, insurance premiums and loan installments are payment obligations that you have to meet.
As before, numerous citizens in Austria have massive financial losses due to the ongoing corona pandemic due to unemployment or ongoing short-time work. And an end to this financial lean period does not seem in sight at the moment.
Although the moratorium on the deferral of loans initiated by the Austrian government has undoubtedly taken the pressure off citizens affected by payment difficulties, the question is already now how things should proceed afterwards?
–
Credit moratorium – extended, extended … ..extended
A brief review: In a first moratorium, the government in cooperation with Austria’s banks decided to be able to suspend repayments of loans unbureaucratically for the period from April 1 to June 30, 2020 upon request.
After it turned out that the corona-related negative effects persist over the period mentioned, the moratorium was extended again. In the meantime, a further extension has been decided until January 31, 2021.
And since deferral does not mean cancellation, deferred loans are now extended to a maximum of 10 months. Because the deferred months are attached to the agreed term of the loan agreement.
–
Several billion euros in loan volume deferred
To make it clear in numbers, what sums are involved that are now burdening the Austrian economy as “open” loans due to deferral of repayment:
By the beginning of June 2020, around 104,000 statutory deferrals with a volume of 4.1 billion euros had been implemented.
Although numerous credit customers have now managed to restore their financial performance so that they can meet their credit obligations, just over 80,000 loans with a volume of 6.6 billion euros are still legally deferred. And that is purely related to the moratorium.
Because to this number there are around 60,000 privately deferred loans with a volume of over 17 billion euros. Because even before the moratorium put in place by the government, numerous banks, recognizing the economic hardship, began to defer loans at the request of their customers or gave their consent.
–
The deferral is all well and good – but the debts remain
These measures have undoubtedly ensured that many people who found themselves in a financial emergency through no fault of their own were given considerable help not to despair. But the problem itself has not been solved, it has only been pushed back.
The mountain of debt is ultimately not reduced by deferring loan installments, etc. And if the corona crisis intensifies again and leads to further short-time work and even bankruptcies, for example in the tourism industry, which is so important for Austria, what then?
–
Is the Big Credit Crash Looming?
A view that is shared by numerous economic and financial experts. It can be heard across the board that it is only a matter of time before another wave of corporate bankruptcies and personal bankruptcies hit the Austrian economy with full force. And then numerous entrepreneurs, freelancers and families will find themselves in a situation that is perhaps even worse than it is today.
Because then the individual financial situation of many people is likely to be so bad that there will be a significant problem in meeting financial obligations in the foreseeable future. And then the question of “How to deal with it?” Arises – a further moratorium on deferral is then hardly the appropriate means.
–
