Problems and Prospects of Consumer Lending Development in the Russian Federation

Abstract

In the current situation, the issues of consumer lending development are extremely significant and become especially acute, since their relevance is obvious both for individuals acting as borrowers and banks, acting as the main creditor of the population, and the economy as a whole. With the help of a consumer loan, the population is able to eliminate the time gap between receiving goods (services) and paying for them, thereby satisfying their needs. The growth of consumer demand raises production processes, increasing market volumes, contributing to the development of the economy and improving the well-being of citizens. Consumer lending plays a key role in the activities of many commercial banks, microfinance organizations and consumer cooperatives, allows expanding the customer base, which compensates for credit risk, as well as generating a significant part of their income for these entities. At the same time, the assessment of trends in the consumer lending market demonstrates an increase in problems that need to be solved. Problems of debt burden of the population, high risks of loan portfolios of banks and other creditors (lenders), a dangerous share of overdue debts and a high value of interest rates on consumer loans, insufficient literacy of the population on financial issues - an incomplete list of problems, the solution of which can have a positive result only with a comprehensive approach — the participation of the state, creditors and borrowers. The main purpose of the article is to determine the prospects for the development of consumer lending in Russia, based on an assessment of its current state, identifying problems and ways to solve them.