At the end of September, the total debt on bank loans in Serbia was 25.8 million euros, which is a monthly increase of 0.8 percent, according to the September report of the Credit Bureau of the Association of Serbian Banks.
The debt of entrepreneurs is 580 million euros, which is 1.3 percent more than at the end of August, while the population increased its debt by 0.8 percent, and legal entities by 0.7 percent.
Out of almost 11 million euros of the population’s debt, almost half, ie 6.5 million euros, is for cash loans, followed by housing and loans for adaptation with 4.5 million euros. The monthly growth of cash loans is 0.8 percent, while the debt of the population on housing loans is higher by 1.3 percent in a month.
Citizens owe 6.5 million euros for cash loans
Although the growth of loans does not seem to be great, in real life it is a huge amount of money that citizens have to pay for interest. Although the amount of interest varies from bank to bank, and also depends on the maturity of the loan, it is certain that Serbian citizens leave large sums of money to banks for cash loans – because with an interest rate of only seven percent, and mostly interest is above that percentage, in total debt population pays more than 339 million euros in interest on cash loans to citizens.
It is important for citizens to know, financial experts point out, that in the case when money is missing, and something must be bought, it is still better to take out a cash loan than to spend money that is not there, that is, to use the allowed minus.
Namely, the allowed minus is the fastest, but also the most expensive loan, and the average interest rate is 29 percent. It is even worse to slip into an impermissible minus because then the interest rates are even higher.
And here’s what it looks like – if you take a loan of 850 euros, with an average interest rate, which ranges from about seven to over 10 percent, the costs are different: if the loan is repaid in 13 months, the monthly installment will be about 70 euros, if the deadline is extended to, say, 18 months, the installment will be around 50 euros, and if the repayment period is 24 months, about 40 euros will have to be set aside per month.
In the first case, the client will pay a total of about 890 euros, while with a repayment period of 18 months, this loan will be around 900 euros, and those who repay the 850 euros loan in two years will pay a total of about 920 euros.
It is certain that the citizens of Serbia would not want to not have to take cash loans, which are, as a rule, among the more expensive services that the bank approves. It is safe to say that most of them decide to do so due to a chronic lack of money, and whether they use these funds to buy something needed in the household or to easily bridge the difference between income and expenses in the household budget – those who are in favor of such step decide. Thus, for example, equipping the kitchen, ie buying only the most important household appliances – stoves, dishwashers and refrigerators, and a more modest variant – requires at least 600 euros. This exceeds the average salary, so it is not surprising that the most common loan that citizens take from banks is a cash loan, Dnevnik reports.
