Asia's credit card debt burden
(Bank for International Settlements)
Recent episodes of credit card distress in Asia
by Tae Soo Kang and Guonan MaBIS Quarterly Review, June 2007
11 June 2007 [pdf]
Asian economies have experienced sharp boom and bust cycles in credit card lending since 1998. Credit card usage and outstanding balances have "increased three- to six-fold between 1998 and 2005." Three examples of boom-bust cycles occurred in the economies of Hong Kong (2002), South Korea (2003), and Taiwan (2006). Credit card usage in Malaysia, Thailand, and Singapore "has shown a more steady pattern of growth." (Bangkok Post, 12-06-07, B1)
Abstract: Not only has credit card lending in Asia grown rapidly, but also several episodes of sharp booms and busts have been experienced, posing new risks to financial stability. Policymakers need to learn more about the risks arising from this type of consumer lending and respond with appropriate prudential measures.
