Year 2021 ended by putting a stop to a five trimester downward in debt default. With a slight increase of 0.1%, the “XXXV Report of Debt Default” (XXXV Informe de Deuda Morosa) carried out by Universidad San Sebastián and Equifax, reports 4.041.273 debtors in Chile.

The period of October, November and December 2020 helped stabilize the number of debtors in the country, due to the stop of withdrawals from the provisional pension fund and a decrease of state support.

On the other hand, default average decreased by 7% to 1.963.012 Chilean pesos either because people were able to catch up and pay on time or because credit providers lowered the amount they loan

A 48.3% of total -around 2 million of people- have published debts of at least 300 thousand Chilean pesos, while the rest, on the other edge, hold debts that exceed 3 million pesos (13%).

Debt breakdown

According to the debt default report, retail gathers the largest number of debtors -with a 43% cut- followed by the bank 25% financial activities and insurance 16%.

In terms of gender, women’s default average was $1.321.026 pesos, while men doubled this figure with $2.642.130. In both cases, debt goes to bank, retail and financial activities.

What’s coming? 

In less than a month and not long after the first withdrawal from the provisional pension fund in July 2020, debt payments increased by 20%. A year later, with the help of two more withdrawals and state support, it was possible to reduce debt default to figures Chile had five years ago.

But 2022’s reality is different. After the rejection of the fourth withdrawal from the provisional pension fund and the gradual stop of social care, the future for Chileans might turn uphill.

2021 ended with the highest inflation since 2007 (7.3%), which directly put a strain on people’s pocket.

This price increase along with the raising interest rates could trigger pre-pandemic levels of indebtedness in Chilean homes, according to the Financial Market Commission. 

Can we be of any help?

In Sumeria, we’re committed to positively impact on debtors’ health and well-being. Therefore, we assist enterprises by delivering personalized treatments, focused on human and empathic procedures in order to increase their recovery rates.

Photo by Mikhail Nilov on Pexels