Applications for personal loans in Norway increased by 20% in 2017.
Last year, residents of Norway sent more than 3.5 million applications for consumer loans, almost 700,000 more applications than the previous year, according to new figures from Finanstilsynet, the Financial Supervisory Authority of Norway.
“Many want to spend money they do not have,” says Finance Norway's Tom Staavi to NRK. He believes that people should think carefully before buying goods and services on credit. He also suggests that personal finance should be taught at school as a subject.
“Finance Norway has warned and continues to warn against taking this type of loan, which is not able to be paid off quickly” he said.
Low approval rate
The increase in applications does not necessarily mean an increase in personal debt, however. According to Finanstilsynet, more than two in three applications for consumer loans and credit cards were rejected in 2017.
Requirements to apply for a personal loan in Norway are that the applicant is over 18 and in steady full-time employment. The amount you can borrow will depend on your salary.
Typically, loans are only available to Norwegian citizens, and foreigners with permanent residence, or a long history of tax returns in Norway. Foreign citizens are usually eligible for a credit card after a full year's tax return has been processed, depending on personal circumstances.
Better financial education is needed
Elin Reitan, economist at Nordea, told NRK that more financial education should be given at school, and encourages parents to talk more about money to their children.
“Many give their children money as needed instead of encouraging saving of regular pocket money. Then a lot of learning disappears, and the kids expect to get what they want, when they want it” she said.
Finanstilsynet is an independent government agency that builds on laws and decisions emanating from the Parliament, the Government and the Ministry of Finance and on international standards for financial supervision and regulation.
Through its supervision of enterprises and markets, Finanstilsynet strives to promote financial stability and orderly market conditions and to instil confidence that financial contracts will be honoured and services performed as intended.