Significant Decrease in Debt Levels Among Dutch Individuals

This article was last updated on February 27, 2024

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A Declining Trend of Debt Among the Dutch

Over the years, there has been a noticeable decrease in the number of Dutch individuals resorting to credit. This decrease also extends to those falling behind on their repayments. According to the Credit Registration Office (BKR), only 7.6 million out of the total Dutch population hold a loan, a decline from 7.8 million the previous year, and a huge drop from over 9 million four years ago. These loans can take a variety of forms, including revolving credits obtained from banks and personal loans taken for major expenses such as car purchases.

The Tightening of Credit Conditions

The primary reason attributed to this decline in credit uptake is the strict credit conditions that have been imposed over time. Out of the 7.6 million loan holders, around 413,000 individuals are reported to be in arrears with fewer than the 439,000 recorded a year earlier. Only around 2.8% of the adult Dutch population (age 18 and above) presently fall behind on their loan repayments.

Reduced Mortgage Arrears

Significant improvements have also been recorded in regards to mortgage arrears. The number of individuals who are late in their payments have more than halved from around 48,000 four years ago to just below 27,000 currently. BKR defines a default as one where any amount of over €250 has not been paid for over a month.

High Debt Levels Tend to Concentrate in Cities

While the overall national figures indicate a declining trend, some exceptions still exist. Major Dutch cities appear to have a disproportionately high number of residents struggling with creditors. Heerlen and Kerkrade in the Limburg region are also notable for their higher-than-average number of financially troubled residents.

Considerations and Limitations of BKR Figures

Although the BKR findings indicate a significant reduction in debt among Dutch people, some limitations must be taken into account. There are other forms of credit such as the ‘buy now, pay later’ scheme, which have become common yet are excluded from BKR records. Furthermore, BKR does not maintain a current record of defaults in the payments of other monthly expenses such as rent, electricity bills, and insurances. According to a survey by CBS in the previous year, around 726,100 households had reported issues with meeting their monthly costs, an increase of 17 percent from the previous year. Fulfilling financial obligations continues to be a sticking point for many Dutch households as evidenced by these statistics.

Final Thoughts

It can be concluded that while the number of Dutch individuals resorting to credit has fallen, specific pockets continue to face financial challenges. Understanding the limitations of the data also provides a more nuanced view of the financial health of the population.