SINGAPORE, Aug 14 — Recent data reveals a significant increase in loan applications from middle-aged Singaporeans (ages 40 to 59) over the past two years, reflecting broader economic pressures.
According to a report from Lendela, a loan matching platform, this age group’s share of loan applications has surged by 28% since 2022, now representing about one-third of all applications. The average loan amount for this demographic stands at S$22,000 (RM73,944).
Loan Applications – Key Findings
- Increased Loan Applications: The middle-aged group has seen a dramatic rise in loan applications, driven by higher living costs and debt-related needs, including recurring bills, debt consolidation, and credit card debt.
- Younger Borrowers: The share of loan applications from younger individuals (ages 18 to 29) has decreased by 25% since 2022, now accounting for over a quarter of applications.
- Income Trends: Middle-income borrowers (earning S$48,000 to S$84,000 annually) have seen a 35% increase in applications, while mid to high-income borrowers (earning above S$84,000 annually) have experienced a 64% rise.
Context and Impact
- Rising Costs: The increase in loan applications among middle-aged individuals correlates with heightened living costs, including household spending and medical expenses. Data also indicates a rise in loan applications for large debts, with a 56% increase for those with debts exceeding S$50,000.
- Government Response: In response to rising costs, the Ministry of Finance will provide a one-off cash payment of S$200 to S$400 to 2.4 million eligible Singaporean adults in September.
Additional Observations
- Retiree Loans: Loan applications from retirees (60+) have jumped by 50% since 2022, though they still represent only 3% of total applications.
- Decline in 30s Borrowers: The share of borrowers in their 30s has slightly declined from just under 40% to 37.6%.
Lendela’s data, based on nearly 200,000 applications from Singaporeans and permanent residents, highlights a trend towards increasing financial pressures across various demographics, underscoring a growing need for financial assistance and debt management solutions.