As many as 100 million Chinese consumers are struggling to service their personal debt, fueling a largely hidden crisis that threatens Beijing¡¯s efforts to revive the world¡¯s second-largest economy.
Bad consumer loans from credit cards to mortgages have surged over the past few years. Nonperforming household debt soared 21% last year to a record of at least 2.22 trillion yuan ($329 billion), according to Gavekal Dragonomics.
The firm analyzed financial reports from 26 banks and other data sources after authorities stopped releasing aggregate figures on delinquent and defaulted personal loans. Analysis from Zhejiang University¡¯s Institute of Financial Research said Chinese financial institutions could have nonperforming personal debt totaling 2 trillion yuan to 3 trillion yuan to dispose of annually.
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