Rabat – A joint report on financial stability by Morocco’s central bank Bank Al-Maghrib (BAM) and other watchdogs of the Moroccan economy has found that the country’s consumer debt rose by an annual average of 5.3% at the end of 2021.
Consumer debt, a type of loan banks issue for individuals to buy goods and services, contracted by 0.7% in 2020 as a result of the deteriorating state of the national consumer purchasing power at the height of the covid-induced economic crisis, says the report.
Jointly conducted by BAM, the Insurance and Social Welfare Supervisory Authorities (ACAPS), and Morocco’s Capital Market Authority (AMMC), the 9th annual report on financial stability notably found that consumer debt totaled MAD 136 billion ($13.1 billion) at the end of 2021, up 5.3% year-on-year.
“After contracting by 0.7% in 2020 due to the decline in demand and the deterioration of household financial conditions, consumer loans showed signs of recovery at the end of 2021 increasing by 5 .3%, with 54% of the said loans issued by banks,” notes the joint report.
Consumer loans make up 70% of the overall loans issued by lending institutions in Morocco, according to a BAM survey of household loans.
The joint report from Morocco’s financial watchdogs further notes that the repayment period for consumer loans has substantially increased in recent years, with 78% of consumer loans in 2021 issued under a repayment period of more than five years.
Despite the seemingly improved consumer loans, long COVID still exercises significant pressure on the national consumer purchasing power.
A recent survey from Morocco’s Higher Commission for Planning (HCP) shows that the growth of domestic market demand in Morocco took a significant hit in the first quarter of 2022, sliding from 6.8% to 0.7% year on year.
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