No matter where you are in the world, the economy is a hot topic. In almost all regions globally there are increasing signs of economic uncertainty – layoffs in multiple sectors, stock market fluctuations, rising interest rates, and escalating inflation. And that economic uncertainty has a noticeable impact on the way financial institutions make decisions and offer products and services to their customers. Consumers may pull back on discretionary spending, but on the flipside also require more access to credit – which financial institutions may be reluctant to give thanks to more conservative risk appetites. Whether we’re entering a full recession or not continues to be debated, but experts agree that either way, a recession or economic downturn “is a significant, widespread and prolonged contraction in economic activity, which can cause reduced sales, leading to layoffs, tightening credit access, and increased loan defaults and bankruptcies.” Provenir experts from around the world are weighing in on what they see happening with the economy now, what lies ahead, and the impact this will have on financial services and lending. Brendan Deakin, Provenir’s GM of the United States, shares that “consumer debt in the U.S. is rising dramatically. Consumer credit card balances rose $46 billion in Q2 2022, a 13% lift from the previous quarter – marking the highest rise in consumer credit card balances in over 20 years.” Also rising are 30- day delinquencies, as borrowers begin to fall behind on their debt obligations. Likewise in Canada, there is troubling evidence of economic uncertainty – increased food and gas prices, geopolitical issues, inflation. Cheryl Woodburn, Provenir’s Country Manager for Canada, says “some reports are showing that by 2025 and 2026 we may see mortgage payments increase between 30 and 45%.” Latin America, which historically reflects the economy of the United States, is seeing its own signs of trouble. Jose Vargas, EVP and GM of Latin America, points out that Argentina is experiencing the worst inflation in the region (64% in June 2022), Colombia’s peso is falling, interest rates in Brazil have
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