First out on the stage during the three-hour long program was Annina H Persson, KTH, and Ann-Sofie Henrikson, Umeå University, presenting the proposal for changes in the Swedish Consumer Credit Law.
The legislation specifically targets the new problem of “over-consumption” and is shaped to counteract risky credits.
“Gambling is one problem when it comes to overindebtedness. But gambling using credit will be tougher, and gambling companies will face a bigger responsibility. The Gambling act will be changed and cooperation between gambling companies and companies granting credits will not be allowed in the future,” says Ann-Sofie Henrikson.
“The present system in Sweden makes it fairly easy to receive a credit line, and we have seen the over-establishment of actors who provide credits. But debts live on, year in and year out, without a period of limitation. In Finland, the limitation period is 15 years,” says Annina H Persson.
She also points out that an overindebted person in Sweden is in a very troublesome situation. Many other countries have some form of incentive to pay off the debts, but not so in Sweden.
“The national authority working with debts – Kronofogden – is very efficient, and persons affected risk living on subsistence level for a very long time.”
Petter Alvsten from UC presented data on debt development over time for mortgages, unsecured loans, and credit cards. The volume of credit card debts has risen significantly during the last 12 months when comparing the three categories.
“We see a steady increase in the number of persons with payment complaints in the last two years, a change from the decreasing trend from 2014,” he says.
Hsu-Chi Weng and Mark Sanctuary, both from KTH, presented results from studies focusing on credit behavior based on large datasets from Klarna. In one of them, they asked: Do people take on more credit on the payday, five days before the payday, or five days after? The answer was counterintuitive; it turned out that consumers used the highest credits on payday. This study is one in a series of six studies, which SFL will come back to in the future.
Fredrik Nordström from The Swedish Investment Fund Association (Fondbolagens Förening) presented data on household savings in Sweden. Funds are a large part of households’ financial assets, and 7 out of 10 adult Swedes have fund assets, which is unique. There is no difference in the proportion between men and women. Half the adult population also saves monthly in funds; 4 out of 10 save 2000 SEK or more. At the end of the presentation, he highlighted policy and research questions that need to be addressed. Among them is how to increase participation amongst people with low education and immigrants.
Last among the speakers was Cecilia Hermansson at KTH, who presented a study focusing on gender differences within a sample of young savers based on data from Avanza Bank. The study asked: How do children save, from the point of time when parents decide to a time when children make their own decisions? Are there gender differences? The results showed considerable differences in the login activity levels. The more active the child, the more likely it is a boy. For a fuller picture, see the presentation below.
Presentations
Annina H Persson, KTH, Ann-Sofie Henrikson,Umeå University, and Petter Alvsten, UC
Fredrik Nordström, The Swedish Investment Fund Association
