Inflation and rising rates put a damper on consumer credit

Cold snap on consumer credit.

Soaring interest rates and inflation, which is undermining household budgets, are causing consumer loan production to falter.

Over one year, the figures remain positive, with production up (+7.6%, to 49.6 billion euros), according to figures published on Wednesday by the Association of Financial Companies (ASF), but in the detail the painting is less rosy.

The distribution of consumer credit – which includes unallocated personal loans, revolving credit or car rental with option to buy – experienced a deceleration at the end of the year (+1.9% in the fourth quarter).

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In question, the supply of credit which tends to shrink like a trickle.

Banks are increasingly hesitant when it comes to lending.

This is particularly true for the distribution of personal loans (13.8 billion euros), whose production plummeted by 23% in December, after falling by almost 17% in November.

Then, inflation weakens the…

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