Argentina’s gig workers are increasingly turning to costly digital loans to cover everyday expenses, with rising household debt adding to financial pressure despite a sharp slowdown in inflation.
Delivery rider Albert Quintero, 41, earns about 70,000 pesos ($46) a day, but recovering an impounded motorcycle can cost around 140,000 pesos ($90) in fines and fees. He said many riders have little choice but to borrow to return to work.
Fintech platforms, including delivery apps and digital wallets, have expanded access to credit, but interest rates can exceed 100% a year. PedidosYa offers riders loans at about 131% annually, while Personal Pay charges around 170%.
Argentina’s fintech lending sector has expanded to about 10 million individual loans, from roughly 500,000 six or seven years ago, according to Mariano Biocca of the Argentine Fintech Chamber.
At the same time, repayment problems have worsened. Nearly 6 million borrowers are more than 90 days behind on payments, while the share of household loans classified as bad debt reached 12.8% in June, its highest level since records began in 2010 and up from 2.8% when President Javier Milei took office in late 2023.
The increase in debt comes as Milei’s austerity measures, including cuts to subsidies, squeeze household budgets. Although inflation has eased, many Argentines say incomes have not kept pace with living costs, increasing reliance on credit for basic expenses.
Milei’s government has resisted calls for state-backed debt relief, arguing that unpaid private loans are largely a consequence of the expansion of consumer credit. Argentina’s private credit market remains relatively small at about 12% of GDP, compared with roughly 80% in neighbouring Brazil.
Analysts say rising household debt could become a political liability ahead of Argentina’s 2027 election, particularly if weak consumption and precarious employment persist.
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