Global Rankings: Personal Debt by Country

Debt plays a significant role in shaping how individuals and households manage their finances. For some, it’s a tool that enables access to education, housing, or essential goods. For others, it’s a burden that limits choices and strains budgets. Across the globe, personal debt levels vary—reflecting not only economic conditions but also cultural attitudes toward credit and borrowing.

In this article, we explore personal debt by country, looking at household debt to income ratio by country and highlighting global trends in consumer borrowing. This data offers a clearer picture of where countries stand and how debt impacts their economies.

Household Debt to Income Ratio by Country (OECD 2023)

Based on the latest data from the OECD, the table below shows the household debt to income ratio by country in 2023. This ratio compares household and NPISH (non-profit institutions serving households) debt to net disposable income, offering a clearer view of how much of a country’s income goes toward paying off debt.

Here’s how selected countries compare, ranked from highest to lowest statistics:

The list reflects wide-ranging economic conditions and spending behaviors. Higher ratios typically indicate greater use of credit—often in countries with higher living costs or widespread homeownership. Lower ratios can result from limited access to loans, cultural debt aversion, or lower income levels.

Understanding how household debt by country compares can provide useful context for evaluating economic resilience and consumer financial health in global markets.

Understanding the Debt to Income Ratio by Country

To put these numbers in perspective, let’s take Switzerland—the country with the highest household debt to income ratio in 2023 at 224.45%. If the average household in Switzerland has a net disposable income of $80,000, this would suggest an average household debt of roughly $179,560.

This doesn’t mean every household in Switzerland owes that much. These are national averages that capture a broad range of financial obligations, including credit card debt, mortgages, student loans, and car payments. The figures help establish a general reference point for how consumer debt by country compares, but individual debt loads will always vary.

Several factors influence personal debt by country. High living costs in urban areas, rising home prices, and access to low-interest loans tend to push debt levels up. Countries like Australia, the Netherlands, and Luxembourg reflect this pattern. For example, housing affordability in cities such as Sydney or Amsterdam contributes to higher borrowing levels.

These figures also have long-term economic implications. When the household debt to income ratio by countrybecomes too high, it may affect future consumer spending and savings habits. A heavily indebted population could dampen domestic demand, which can eventually influence national GDP growth.

As countries continue to navigate economic shifts, global leaders and financial institutions will need to monitor how household debt by country evolves to ensure sustainable financial outcomes in the future.

What Drives High Household Debt by Country?

Several factors influence high consumer debt by country:

Housing Market Dynamics

Countries with expensive real estate markets often have high mortgage debt. This is evident in Denmark, Australia, and South Korea.

Cultural Norms

In some countries, borrowing is normalized for large purchases such as education or housing. In others, consumers avoid debt even if it limits access to certain goods.

Access to Credit

Widespread availability of low-interest loans or credit cards can raise household debt levels, especially in high-income countries.

Social Safety Nets

Nations with generous welfare programs may encourage more borrowing since healthcare and education expenses are partially covered, freeing up income for other forms of debt.

The Economic Impact of Rising Debt

Personal and household debt can stimulate short-term economic activity. When borrowing increases, so does consumer spending—often on homes, vehicles, and household goods. This surge can boost demand and temporarily increase job creation.

However, a higher debt load eventually leads to reduced spending, especially when repayments begin. According to the International Monetary Fund (IMF), this pattern typically results in a slowdown in economic growth after about three to five years. Individuals and families start cutting expenses to focus on loan repayments, contributing to lower consumption and potential job losses.

This shift underscores the importance of maintaining a healthy balance between income and debt—something that becomes harder as household debt to income ratio by country rises.

Consumer Debt by Country: Short-Term Benefits, Long-Term Risks

Governments and financial institutions often look at national debt levels to assess economic stability. While high consumer debt by country can signal strong access to financial services, it can also raise concerns about long-term sustainability.

Too much reliance on credit can increase default risks. Countries with high debt-to-income ratios are more vulnerable to interest rate hikes, inflation, or job market instability. These risks are especially pronounced in countries where wages are not rising in step with borrowing.

How Countries Can Address the Debt Challenge

While household debt levels reflect personal financial decisions, national policies also play a role. To help reduce household debt by country, governments and central banks can:

• Encourage responsible lending by tightening credit approval standards
• Offer financial literacy programs to educate consumers about debt management
• Introduce flexible repayment schemes or interest rate subsidies for essential loans
• Monitor real estate market trends and prevent unsustainable price growth
• Strengthen consumer protection laws to limit predatory lending

Some countries, like South Korea, have introduced macroprudential regulations to curb risky lending. Others have used interest rate policies to make borrowing more or less attractive, depending on inflation and economic goals.

Global Debt Patterns: Who Owes the Most?

Looking at personal debt by country on a global scale, certain patterns emerge:

• High-income countries tend to have higher debt-to-income ratios. This includes most of Western Europe, North America, and parts of Asia like South Korea and Japan.
• Developing economies often show lower household debt by country, but this doesn’t necessarily mean stronger financial health. In many cases, limited access to formal credit or lower incomes keep borrowing levels artificially low.
• Urban vs. Rural Divide: Within countries, cities tend to report higher household debt levels due to property prices and cost of living.

Understanding these differences is key to crafting policies that address the root causes of over-indebtedness without restricting access to necessary credit.

Comparing Household Debt by Country

Debt is a complex issue that touches nearly every aspect of economic life. When looking at personal debt by country, it becomes clear that income levels, housing prices, cultural factors, and credit availability all play a part in shaping national averages.

Countries like Denmark, Norway, and the Netherlands show the highest household debt to income ratio by country. On the other end, countries with lower incomes or less developed credit systems report much lower ratios—but that doesn’t always indicate financial well-being.

Whether you’re analyzing global consumer debt trends or trying to understand your own financial standing, looking at how household debt by country compares can provide valuable context. Recognizing the patterns helps governments, businesses, and individuals make more informed decisions about borrowing, spending, and saving.