UrBC, Moscow, May 20, 2019. Both private borrowers and financing organizations might find themselves trapped through over-intensive consumer lending currently unfolding on the Russian market, Bank of Russia’s First Deputy Head Dmitri Tulin said at the State Duma Finance Market Committee’s recent meeting.

According to Interfax, Tulin believes that while an increase in consumer lending is a natural process that shouldn't get artificially restrained, the speed of the said process is starting to look alarming. There’s a possibility that this could leave both the customers and the banks trapped.

Tulin did admit that the CBR’s measures failed to slow the consumer lending trends down on the annual scale, even though the monthly and quarterly dynamics changed. He also explained why consumer loans are now on the rise:

‘People’s actual incomes kept shrinking starting from 2015-2017 and on, so consumer spending plummeted. In 2018, things got somewhat better, as the consumer spending stopped going down at least. Russians probably grew tired of living so frugally, so some of them are now taking out consumer loans to keep up with their current spending and avoid having to cut back on things,’ Tulin said.