The rise in wages is the main factor that drove many Romanians to borrow more money to redecorate/renovate their homes, buy cars, home appliances and even phones.
For instance, the sales of phones rose by 40% in value in the first half over the first half 2017, which took the market by surprise. The average net salary in the first half went up by 13% (RON300) to RON2,636 compared with the year-ago period. The average wage in 2007 was less than RON1,000 and in 2009 stood at RON1,400.
“The most important factor in the consumer lending growth is the wage raises. We have customers who had their salaries double, which encouraged them to take out loans,” said Liviu Andrei, managing partner of loan broker Alliance.
Good interests, too, made it easier for consumers to decide to borrow money from banks. The annualized percentage rate of a consumer loan in lei stood at 10.8% in the first half, the lowest since 2007. The APR before the crisis in 2007-2008 was about 18% only to go up to almost 25% in 2009. The resumed growth of the reference rate for leu loans, ROBOR, is not too big of a threat for people taking out consumer loans, as 80% to 90% of the new such loans come with fixed interest for the entire duration of the contract.(EUR1=RON4.6445)
(English version by Loredana Fratila-Cristescu)