SINGAPORE: A recent survey has unveiled a significant increase in the number of middle-aged individuals in Singapore applying for personal loans, reflecting the escalating pressures of living costs.
Lendela, a leading personal loan comparison service platform, conducted the survey based on an analysis of approximately 200,000 loan applications submitted by Singaporean citizens and permanent residents between June 2022 and June 2024.
The data reveals that loan applications from middle-aged individuals, specifically those aged 40 to 59, have surged by 28% over the past two years. This age group now represents about one-third of all loan applications, with the average loan amount reaching $22,000.
The primary reasons for these loan requests are to manage household expenses, cover medical costs, and settle credit card debts.
In contrast, applications from younger individuals aged 18 to 29 have seen a decline. This demographic, which accounted for more than a quarter of the total loan applications, has experienced a 25% drop compared to 2022.
The survey also highlighted a notable increase in loan applications from individuals with varying income levels. Borrowers with an annual income ranging from $48,000 to $84,000 saw a 35% increase in loan applications.
More strikingly, there was a 64% surge in applications from middle- and high-income earners with annual incomes exceeding $84,000.
The data also showed that one-fifth of all loan applications for living expenses were for amounts over $20,000. Within this category, the number of borrowers already in debt rose by 25% from June 2022 to June 2024. Alarmingly, the number of borrowers with debts exceeding $50,000 increased by 56%.
Lendela’s findings point to the growing financial strain faced by middle-aged Singaporeans as they grapple with the rising cost of living. As more individuals in this age group seek financial assistance to manage their expenses, the trend raises concerns about the long-term financial stability of this demographic.
The increase in loan applications from higher-income earners also suggests that financial pressures are not limited to lower-income groups but are affecting a broader spectrum of society.
TISG/