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Potential of sustainable lending to individuals: Russian small monotowns' population peculiarities

Potential of sustainable lending to individuals: Russian small monotowns' population peculiarities

Journal of Economic Regulation, , Vol. 5 (no. 3),
p. 124-138

Sustainable lending potential activation is of current importance for Russian monotowns residents because of possible negative socio-economic effects of lending policy causing over-indebtedness of Russian households, especially of low income ones. Sustainable lending to individuals is considered as an instrument to increase positive effect of consumer lending, both to improve quality of borrowers ’ life today against future income, and to promote local socio-economic development by means of purpose loans. Loans ’ purposes should have the high probability of a positive impact on the borrowers ’ household welfare and be harmonized with the objectives of socio-economic development of the territories of the borrowers’ residence.
Comparative assessment of sustainable lending potential factors for the residents of the Russian monotowns and the Russian Federation as a whole is held. Integrated Household Living Conditions Survey by the Federal State Statistics Service of the Russian Federation is used as the data source. In Russia, monotowns’ residents, compared to the average level, are revealed to have a higher sustainable lending potential, due to less accessibility of consumer goods, higher needs for improvements of living conditions, and lower incomes. Therefore, the current income and/or savings are/is more difficult to be used by monotowns’ residents for these purposes. Thus, the appropriateness of sustainable lending programs to be developed and implemented in depressed monotowns is proved by the author.

Keywords: monotowns; lending to individuals; lending potential; sustainable lending; local socioeconomic development; household income; household needs

Publisher: Ltd. "Humanitarian perspectives"
Founder: Southern Federal University
ISSN: 2078-5429