Notifications from banks about the high level of borrowers’ debt levels are called a useless measure

“Another formal piece of paper”

Since 2024, banks are required to warn clients wishing to take out a loan about the high (over 50%) indicator of their debt burden (PDL) and associated risks. In theory, the measure looks absolutely justified, but in terms of implementation it raises serious doubts. Its deliberate ineffectiveness is indicated, for example, by the fact that PDN is calculated from official income, and many Russian borrowers are employed in the shadow sector and receive cash in hand from their employer.

In addition, today there is no uniform banking practice of informing citizens about high personal income tax. Let us remind you that PDN is the ratio of the client’s average monthly payments for all approved or already existing loans and borrowings to his average monthly official income. Banks are still rejecting requests from borrowers who are too over-leveraged, mainly due to the regulatory requirements of the Central Bank. In 2023, the Bank of Russia several times tightened the rules for banks for issuing unsecured and mortgage loans. Thus, in unsecured lending, so-called macroprudential premiums and macroprodential limits are used.

In principle, a PDN value above 50% does not apply to formal reasons for loan refusal (which, by the way, is stated by the banks themselves). Rather, this is a reason for the borrower himself to think about whether he will meet his debt obligations. In reality, a warning notice from a financial institution is unlikely to stop people.

“Most likely, it will become just another mandatory, formal “piece of paper” that will have to be signed among many others,” says Alexander Shneiderman, head of the sales and customer support department at Alfa-Forex. – The chance that a person will change his mind about taking a loan directly at the bank’s office is extremely small. As a rule, Russians are well aware of the loan agreements they have in hand. In addition, the very parameter for calculating the personal income tax is questionable: 50% is considered from official income, and, according to a survey by VTsIOM, in the age category of 35-44 years, every tenth person receives a salary “in an envelope.” This is the target category for banks in terms of issuing loans.”

Many citizens have income from renting out housing and do not “shine” this money, preferring cash. For them, the actual personal income tax will differ from the official one, calculated in the bank, to a lesser extent. Shneiderman also gives the opposite example. For example, if the lion’s share of a family’s income goes to paying for rental housing (that is, there is not much money left to cover debts), the official PIT much lower than the cutoff of 50% will also be calculated incorrectly. The bank will not notify such clients who are actually at risk that the “dangerous” threshold has been exceeded.

“The rule introduced on January 1 will not have any effect on the mood of the bulk of Russian borrowers,” believes financial analyst, Candidate of Economic Sciences Mikhail Belyaev. – Mostly people take out loans with full inner conviction, being perfectly aware of what their total income is, what debt load they will have to bear, how, when and in what amount they will pay. Moreover, for many, sources of income are not limited to official earnings. In information technology terms, this creates an additional headache for banks: is it possible to keep track of all the clients, whose accounts sometimes run into millions? So the final effect seems very doubtful.”

According to Belyaev, it would be better if the state took care of the problem of unauthorized (fraudulently) issued loans. Why not introduce a standard for credit risks that applies to plastic cards? According to Article 9 of the Law “On the National Payment System”, a person must receive an SMS notification from the bank to his phone number about each transaction made, and if suspicion arises, he has a day to protest. The SMS notification mechanism would be extremely useful in cases where attackers try to issue consumer loans to third parties by gaining access to their personal data. So far, no antidote has been found against this kind of action, Belyaev sums up.