SEK 469,000. Every Swede had loans this high on average at the end of 2022.
And the Swedes’ debt ratio, i.e. the households’ total debts in relation to their incomes, is third highest in the EU according to a new compilation from Statistics Norway.
During the last 30 years, Swedes’ debts have doubled, while the amortization rate has been low compared to other countries.
– We stand out in that way, but we have also had households that saved a lot in other ways. So these international comparisons are not entirely simple, says Fredrik NG Andersson, senior lecturer in economics at Lund University.
Political bat
After a long political discussion about the amortization requirement, the government has now appointed an expert committee to investigate the effects of it.
– It is clear that there are both pros and cons to an amortization requirement and they need to be set against each other, says national economist John Hassler, who is one of those who will carry out the investigation, to TT.
Both the Financial Supervisory Authority and the Riksbank have previously been critical of dropping the amortization requirement. The former head of the Riksbank, Stefan Ingves, even went so far as to call an amortization break “shooting himself in the foot” last October.
Economy in imbalance
All the experts SVT Nyheter spoke to agree on one thing. Amortization requirement or not: Sweden has financial challenges ahead.
Fredrik NG Andersson also points out that to some extent we put ourselves in this position, with a Riksbank and a Financial Supervisory Authority pulling in different directions. One that pushes down interest rates and one that wants to slow down our debts.
– Imagine that you are driving a car and the Riksbank puts its foot on the gas – and then the Financial Supervisory Authority puts its foot on the brake at the same time. It does not work. And that’s kind of where we’ve ended up.
But how did we end up here and what are the arguments for and against the amortization requirement? See SVT’s deepening in the video above.
