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Rising Cost of Living in Italy: Families Increasingly Indebted, Growing Usury Risk

The cost of living in Italy is posing a significant challenge to families, with a noticeable increase in indebtedness. According to Assoutenti, in 2023, the average debt per Italian citizen, including newborns, amounts to approximately €9,949, while the average debt per family stands at €22,674. These concerning figures are accompanied by a growing risk of usury, as reported by the association.

Rising Cost of Living: Increasing Indebtedness

Inflation in the 2022/2023 biennium has inflicted a financial blow to Italian families, with a total increase in costs of €4,165 per family. A tangible example is the variable-rate mortgage of €150,000, which now costs almost €4,400 more annually compared to 2021. These increases are weighing on family budgets, forcing many to resort to loans and financing.

Exponential Growth of Consumer Credit

Assoutenti estimates that by the end of 2023, the value of consumer credit will reach a record €160 billion in Italy, marking a staggering +220% growth compared to 20 years ago. The total of mortgages taken out by families amounts to €425 billion, with €162 billion represented by variable-rate mortgages.

Rising Cost of Living: Impact on Variable-Rate Mortgages

The drama intensifies with the continuous rises in interest rates imposed by the European Central Bank (ECB) over the past two years. For instance, a variable-rate mortgage of €150,000 with a term of 25 years now costs +€4,380 more annually compared to 2021, with the monthly installment rising by an average of +€365. This phenomenon contributes to the escalation of over-indebtedness and the risk of usury.

Rising Cost of Living: Alarm and Appointment at Expo Consumers 2023

The Assoutenti association sounds a strong alarm about the rising over-indebtedness and usury risk becoming a daily reality for many Italian families. To address this delicate situation, the Expo Consumers 2023 will be held from December 12 to 14 in Portici (NA). In this event, consumers, institutions, and authorities will discuss necessary initiatives to create a more sustainable economy closer to the needs of the population.

Growing Fear of Usury

The association warns about the “karstic” phenomenon of usury, challenging to identify and combat. The fear of turning to law enforcement is widespread among victims, often threatened and concerned for their physical safety and that of their loved ones.

Future Outlook

Despite current difficulties, future prospects do not seem to promise decreases in interest rates in the short term. However, there is a slight slowdown in inflation, with expectations of November data showing a shift from 2.9% to 2.8% annually in the Eurozone.

In conclusion, the rising cost of living in Italy is profoundly shaping the financial lives of families, with increasing indebtedness and a growing presence of usury risk. Expo Consumers 2023 emerges as a crucial opportunity to discuss solutions and strategies that can lead to a more sustainable economy and a reduction in the financial burden on Italian families.

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