New study: 1 in 5 Romanians in neck-deep debts
A turbulent period of economic downfall, followed by a complicated winter and fear of recession, is set to hit Romanians.
A turbulent period of economic downfall, followed by a complicated winter and fear of recession, is set to hit Romanians.
A new study conducted by Bucharest-based fintech institution Kruk and the Romanian Institute for Evaluation and Strategy (IRES) reveals an uneasy reality – 22% of Romanians are in neck-deep debts, resulting from unpaid bills (15%), loans (8%), and installments (7%).
“I started this research in a special economic context, difficult for the personal finances of Romanians with loans, but also of those who pay for food, utilities, and services,” says Cosmina Marinescu, CEO Kruk Romania. “That's why we sought to find out a barometer of debts and see how many Romanians take them on because this is the first step towards balancing the financial situation for the coming winter and for next year,” she adds.
Plenty of reasons, including insufficient or complete lack of income and health problems, are said to be the main causes for accumulating debts. More than half of these arrears are valued at one monthly income, and 16% of them already owe more than three months’ worth of salary.
The analysis also shows that almost half of Romanian families are in debt and find it difficult to pay them off, thus resulting in negligence of saving, despite the increase in an average amount of saving from last year’s number of RON 960 per month to RON 1,125.
Three out of 10 Romanians live only with the bare necessities, let alone thinking about making room for emergency funds, and only 40% declare that they have money for a decent living.
“To avoid a spiral of debt, it is necessary to correctly evaluate our income, to save intelligently, to prioritize and limit expenses to what is really essential, to learn how to manage our giving so that we ensure that we get rid of the stress generated by them,” Kruk COO Liviu Costică advises.
