Between July and October 2020, the number of people in El Salvador exploring mortgage options online increased by 18%, and the number of Costa Rican consumers looking to buy credit cards decreased by 60%.
CentralAmericaData's interactive platform Consumer Insights monitors in real time the changes in consumer habits in all markets in the region and in other Latin American countries, with fundamental information to understand their behavior, new trends and anticipate eventual changes in their purchase patterns.
Between May and June of this year, the average lending rate of commercial banks has fallen from 11.52% to 10.28%, a drop that is explained by the high level of liquidity of the banks and the low placement of credits.
The pandemic that caused the outbreak of covid-19 has hit the financial system, since due to the current market conditions, the active rates have come down between the months of May and July.
In the countries of the region, more than 8 million people are looking for credit on the Internet. Of this group of consumers, approximately 9% explore options for taking out a student loan.
The interactive information system developed by CentralAmericaData monitors in real time the changes in consumer habits in all markets of the region, with fundamental information to understand the new commercial environment that has emerged in an accelerated manner.
The coronavirus has left an economic impact in several countries. For this reason, some governments are developing exceptional measures to mitigate its effects. For example, the suspension of tax and mortgage payments to lessen the economic pressure on small businesses and households.
In the United States, interest rates were reduced to almost zero and a US$700 billion stimulus program was launched in a bid to protect its economy, says Mario Miranda, director of finance at MonederoSMART.
Between March 2018 and September 2019, the number of loans granted in Nicaragua by the banking sector has been reduced by around 540,000, a drop attributed to the economic crisis the country is going through.
Data from the Superintendence of Banks and Other Financial Institutions (Siboif), say that in March last year, the month before the onset of the crisis, 1.8 million loans were reported, and in September 2019 the figure fell to 1.26 million.
Up to December 2018, the gross portfolio of the financial system in Nicaragua totaled $4.464 million, 9% less than in the same month in 2017, partly because of the performance of commercial and personal credit.
From the Central Bank of Nicaragua report:
For commercial credit, there was a 10.7 percent reduction from last year and for personal loans, the reduction was 14.1 percent.
Limiting the fees charged in Costa Rica and establishing a law that defines market limits in Guatemala are part of the attempts being made in the region to regulate the use of credit cards.
A law proposal presented last January before the Legislative Assembly of Costa Rica, aims to regulate the percentage of the commission paid by businesses for credit or debit cards.
Up to November 2018, the gross portfolio of the financial system in Nicaragua totaled $4.716 million, 7% less than in the same month in 2017, partly because of the performance of commercial credit.
From the Central Bank of Nicaragua report:
In November, the financial system's loan portfolio decreased by 6.8 percent year-on-year (3.5% in Oct-18), reaching a gross portfolio of 153,055.5 million Cordobas.
At the end of September of this year, the gross portfolio of the country's commercial sector reached $1.703 million, which is 2.1% lower than that reported in the same month of 2017.
Central Bank of Nicaragua (BCN) reported that, at the end of September of this year, the country's gross banking portfolio reached $4,891 million, 0.3% less than that reported in the same month of 2017.
Due to the crisis affecting Nicaragua, financial institutions have started to record increases in the number of clients that are in default of their loans.
Due to the situation in the country and with the objective of favoring the debtors, the Superintendency of Banks and Other Financial Institutions and the National Microfinance Commission recently approved some temporary rules so that financial entities can modify the original conditions of the loans.
The 16% year-on-year growth registered in July in Nicaragua's banking credit portfolio is mainly due to an increase in loans for consumption and industrial activity.
From a report by the Central Bank of Nicaragua:
On September 8, 2017, the Central Bank of Nicaragua (BCN) published its Financial Report for the month of July of this year.
As of April, the gross loan portfolio of the financial system totaled $4,982 million, recording a year-on-year growth of 18%.
Personal credit led the year-on-year growth with 22.3%, followed by credit cards with a rate of 19.8%, however, this sector only represents 7.2% of the total portfolio.
Between 2010 and September 2016 the gross balance of loans granted through credit cards grew by more than 100%, going from $145 million to $340 million.
Figures from the Superintendency of Banks and Other Financial Institutions (SIBOIF) show that the number of loans granted through credit cards rose from 541,000 in 2009 to more than 1 million to September this year.
In June 2016 the gross credit portfolio grew by 23% compared to the same period in 2015, led by personal, commercial and livestock credit, which grew by 32% and 25% and 26%, respectively.
From a report by the Central Bank of Nicaragua:
As of June, indicators from the National Financial System (SFN by its initials in Spanish) show dynamism in intermediation, with adequate risk management and good indicators for profitability, solvency and capital.The loan portfolio of the financial system continues to grow above 20 percent and has appropriate risk indicators.Meanwhile, deposits are growing at a decelerating annual rate of rate of 11.4 percent.In addition, the good performance of the financial system is reflected in profitability indicators (ROE of around 20%), solvency (enough coverage for portfolio at risk and overdue) and capital (capital adequacy greater than that required by the regulations).
The good economic performance is reflected in the loan portfolio of the banking system, driven by the livestock sector, consumption and commerce, which in May had a growth rate of 18%.
From The "Monetary and Financial Report 2015," by the Central Bank of Nicaragua:
As of May 2015, the financial system remains stable, with credit and deposits growing, albeit at a slower pace than in the same period in 2014.