A recent study by the Chamber of Commerce of Santa Cruz de Tenerife assures that, during 2023, the Canarian economy showed growth above estimates. Although the figure seems positive at first glance, it does not show the reality that the citizens of the Community are going through. This seems to be deduced from the Survey of Living Conditions (ECV), of the National Institute of Statistics (INE) corresponding to 2023, in which it was announced that 53.1% of Canarian households have difficulties coping with the payment of unplanned expenses, almost 20 points above the national average (37.1%).
The organization categorizes households with difficulties as those that need to access external financing, such as loans or installment payments, to make unforeseen expenses. This is a figure that would have increased nationally for the second consecutive year, surpassed only by the 38.7% registered in 2016.
These difficulties are also present in the mortgage market in the Canary Islands, where there was a 3.46% drop in the signing of mortgages compared to 2022, placing it well below pre-pandemic figures.
Although paradoxical, "making ends meet" is one of the most mentioned reasons by Spaniards when applying for consumer loans in the post-pandemic years, with the first reports in this regard emerging in mid-2022. By 2023, loans became a popular tool in households when making unforeseen expenses.
The Canary Islands do not escape this reality. A study by Canarias Sin Deuda assures that 69% of families in the region have debts for basic consumption (housing payment, shopping basket and transport). Thus, the increase in financing requests in the Canary Islands would not be a possibility, but a certainty for this 2024.
With the oversupply experienced by the market, not only in the number of entities but also in the types of products, the specialized loan platform Finbino recommends a thorough analysis of the options before making any decision, studying aspects such as the amount, interest, number of installments, and even the reputation of the lending company.
From Canarias Sin Deuda, although they do not categorize indebtedness as something purely negative, they do state that it should not exceed 40% of the assets or income of families, since a higher proportion may mean a significant risk for household finances.
This increase in applications would also be a concern for the authorities, with cases such as the recent identity theft in Lanzarote again demonstrating the need to increase education on the management of finances and sensitive information.
Although we are only in the first quarter of 2024, debt in the Canary Islands could become a problem for citizens who do not manage their finances appropriately.
