97.9 percent of Germans repaid their loans on time in 2018, marking a slight increase compared to the previous year and the highest value during the last 10 years, according to the annual so-called loan compass published by the German General Credit Protection Agency (Schufa).
The high percentage of Germans who repaid their loans showed that “Germany’s consumers act very responsibly in financial matters,” said Michael Freytag, leader of Schufa.
Germany’s youngest borrowers repaid their credits on time, with an above-average value of 98.3 percent, which was a “particularly pleasing” development, according to Schufa.
The data from Germany’s largest credit bureau contradicted the assumption that young people “would not be able to deal with loan obligations”.
In total, around 18.4 million installment loans were outstanding in Germany in 2018, slightly more than in 2017.
In addition, “the trend towards higher loan sums continues,” according to Schufa. The average amount of a newly concluded loan was around 11,140 euros (12,545 U.S. dollars) in 2018, an increase of 8.5 percent.
German consumers were most likely to use instalment credit for the purchase of cars, furniture and electronic appliances, according to Schufa.
At the same time, German consumer sentiment experienced a slight setback in June, Germany’s largest market research institute GfK announced last week.
The main reason for the declining consumer sentiment was “worsened income expectations” as Germans were increasingly concerned about an “end of the employment boom,” according to the GfK.