The financial health of Czech households is showing signs of strain as loan defaults surge across the country. By the end of March, the volume of non-performing loans increased by 14% year-over-year, reaching a concerning total of 34 billion crowns.
According to data from the Banking and Non-Banking Client Information Registry, over 177,000 people faced difficulties with consumer and short-term loan payments in the first quarter, up from 171,000 last year. The average defaulted amount per person stands at 165,640 crowns.
The situation is particularly acute among those aged 35-44, with over 42,000 individuals in this age group struggling with payments. Their total debt volume has increased by 22% year-over-year to 7.8 billion crowns.
Housing loans haven’t escaped the trend either. The first quarter saw a 7% year-over-year increase in troubled mortgage and building society loans, marking a concerning acceleration compared to the previous quarter.
Financial advisory centers are reporting a 20% increase in clients seeking help with loan repayment difficulties. According to Hynek Kalvoda from the Association of Civil Counseling Centers, the primary factors are rising living costs, particularly housing expenses, with many people unable to cover increased rents from their income or housing benefits.