Argentina’s household debt delinquency has hit a record, and President Milei and the International Monetary Fund both played it down this month, while independent economists warn it is starting to weigh on growth.
Argentina’s overall private-sector delinquency rate reached 7.6% in June, according to Central Bank data, with the household component alone climbing to 12.8%, more than double the 5.2% recorded a year earlier. The credit-to-GDP ratio, at 14.3%, remains the lowest in Latin America, far below the regional average of 47.3%, so the wave is unfolding in a financial system that extends comparatively little credit to begin with.
Central Bank Vice President Vladimir Werning told reporters that delinquency “had peaked over the previous three months” and that improvement should be expected from the second half of the year. Milei offered a more colloquial explanation, saying people “bought TVs to watch the World Cup and then decided whether to pay or not,” attributing part of the surge to consumers who did not pay for them.
The IMF struck a similar note. Fund spokesperson Julie Kozack said Washington was “closely monitoring” the situation but questioned whether it “represents a significant risk to the country’s financial stability,” a position consistent with the Fund’s earlier assessment that household debt remains small relative to the size of Argentina’s economy and that local banks are well capitalized against the losses.
Independent consultants Juan Manuel Telechea and Claudio Caprarulo pushed back, arguing that even if delinquency does not threaten bank solvency, it is already restricting households’ access to new credit and, with it, the domestic consumption that helped drive Argentina’s growth in 2024 and 2025. They pointed to the construction and textile sectors, both already weakened by Milei’s broader economic program, as particularly exposed to a pullback in consumer borrowing. Their proposed remedies include government-backed refinancing programs and having Argentina’s state pension agency purchase distressed household debt on better repayment terms than banks currently offer.
The IMF’s third review mission for Argentina’s program arrives this week.