Consumer Credit in Argentina

PROSPECTS

Mortgages/housing booms until the US dollar increases

In 2017, the government started encouraged the granting of mortgage loans to be repaid within 20 or 30 years, with interest rates updated according to the variations in the Unit of Purchase Value (UVA). This generated an important movement in the real estate market because, in the country, the possibility of buying a house through bank financing had been almost non-existent, and such lending therefore reached significant peaks in the first months of 2018.

Personal loans continue growing

Personal loans have continued growing at a higher level than card lending and auto lending. In most cases, card and car loans tend to have a similar interest rate and getting them approved is much more complicated and requires more bureaucracy than personal loans, which is why in many cases people continue to prefer to request a personal loan to buy a car.

Student loans are almost non-existent in Argentina as most universities are free of charge

Unlike the majority of countries in the world, in Argentina public universities are totally free of charge. These universities have great prestige and are listed as the best in which people can study, for two reasons: their prestige and because they are free.

COMPETITIVE LANDSCAPE

Fintech companies experience a great boom in personal loans

During recent years, there has been an important digital transformation in the financial industry due to the emergence of fintech companies, which have contributed to a new way of thinking, competing and operating in the financial world. These players compete directly with traditional companies within the industry such as banks.

The government relaunches Anses loans to encourage consumption in the most vulnerable groups

There were two important factors that slowed consumption in Argentina in 2018 and that have an enormous impact on inflation, which will be much higher than initially estimated by the government. Firstly, there was an increase in tariffs for services such as water, gas and electricity, which seriously challenged consumer budgets.

Wilobank, the first 100% digital bank in Argentina, grants personal loans with a considerably lower rate than other players

In June 2018, Wilobank, the first 100% digital bank in Argentina, began operating. Due to not having physical branches, its operational costs are significantly reduced, which allows it to offer lower rates in all the offered services.

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