Household Credit: Debt Soars, with Nearly Four in Ten New Borrowers Already in the Red
The debt levels among Moroccan households are increasing at their fastest pace since 2012. Beneath the overall figures, a new financial stability report unveils a less comfortable reality: 38% of new borrowers are dedicating more than 40% of their income to repaying their debts.
As housing and consumer credit continue to gain traction, household debt reached 456 billion dirhams by the end of 2025, marking a 6.9% increase over the year and representing 27% of the GDP. This is unprecedented since 2012.
On paper, the situation doesn’t seem alarming. Households possess financial assets totaling 1.192 trillion dirhams, primarily consisting of bank deposits (935 billion dirhams). However, this apparent affluence masks an essential truth: those who save are not necessarily the same as those who are in debt, and not everyone has the same level of financial flexibility.
Already Tight Budgets
The clearest signal comes from new borrowers. Their average debt-to-income ratio rose from 34% to 36% in just one year, and, notably, 38% of them exceed the threshold of 40% of their income for debt repayments.
While this threshold is not a strict boundary between solvency and default, disposable income, household composition, and other expenses also weigh in the balance. Nonetheless, it highlights a vulnerability that national averages tend to obscure.
The debt-to-GDP ratio measures the weight of the debt within the economy, rather than the ability of the most constrained households to absorb increased expenses or interruptions in income. Meanwhile, the default rate, pegged at 10.3% in 2025, confirms that repayment difficulties remain under observation, although it does not establish a direct link with the breach of the 40% threshold.
Housing Loans vs. Consumer Credit: Two Different Logics
Another point of concern is that not all credits are created equal. A housing loan finances an asset over a generally long-term horizon, whereas consumer credit can cover current purchases or one-off expenses. Loan terms, guarantees, and the financial margins of borrowers differ significantly.
For banks, the mere evolution of the debt cannot suffice as an indicator of risk. It is the distribution of repayment burdens across income levels, occupational categories, and types of credit that becomes crucial. It is at this scale that the system’s ability to finance new projects without jeopardizing the budgets of the most vulnerable will be gauged.
The pressing question is whether the increase in debt effort is concentrated among certain income brackets or if it affects all new borrowers. The answer will alter the understanding of the phenomenon: debt held by households with stable incomes has different implications than a rise driven by borrowers already on the brink of their limits.
Written by: Le Décrypteur
