In 2022, individuals under 21 were granted less than 4% of loans from non-bank creditors in Latvia, highlighting significant barriers for this age group.
In Latvia, a recent report from the 'Fintech Latvia' association indicates that individuals under the age of 21 were issued less than 4% of the total loans from non-bank creditors in 2022. The data, compiled by the credit information bureau 'Crefo birojs,' reveals that the average loan amounts for this demographic were around 200 euros. This statistic showcases a considerable limitation in financial accessibility for young people in the country.
Particularly alarming is the data concerning the youngest applicants, where only 0.5% of loan contracts were approved for 18-year-olds, and 1.1% for 19-year-olds. With loan approvals for 20-year-olds accounting for just 1.9% of the total issued loans, the chances for those aged 18 to 19 are notably low. This indicates not only a financial barrier but also a concerning trend where young people are systematically underrepresented in borrowing statistics compared to other age groups.
The association's director, Tina LÅ«se, emphasized that the youth effectively form an extremely limited group of borrowers, reflecting a highly conservative lending approach. The loan approval rate for the 18-19 age group stood at a mere 24%, which starkly contrasts with the average approval rate of 43% across overall portfolios. This conservative lending strategy raises questions about the long-term financial inclusion of young people in Latvia and the potential impact on their economic prospects.
