Rising household debt and poverty in Sweden and Finland

Economic indicators in Sweden and Finland show rising financial pressures for households. In Sweden, analysts have warned that mortgage costs could increase significantly as market expectations suggest interest rates may climb toward 2.75 to 3 percent over the coming year. In Finland, student debt has more than doubled over the last 15 years, with the average debt rising from approximately 5,000 euros in the 2010–2011 academic year to 12,700 euros in 2025.

Recent data from Sveriges Stadsmissioner indicates a deepening crisis in Sweden. The 2026 Poverty Report reveals that approximately 500,000 people—about 5 percent of the population—are heavily indebted, either undergoing debt restructuring or holding debts with the Swedish Enforcement Authority (Kronofogden). This represents the highest number of indebted individuals in over 20 years and a 13 percent increase since 2019.

Jonas Rydberg, Secretary General for Sveriges Stadsmissioner, noted that this debt is driven by ‘survival consumption’ to cover essentials like rent and food. The report further indicates that debt among young adults has doubled over the last decade, which Rydberg suggests is a symptom of poverty and the erosion of welfare and social insurance systems. Additionally, poverty in Sweden has reportedly doubled since 2021, with 730,000 people currently living in poverty.

To address these systemic issues, legal expert Ann-Sofie Henrikson and Sveriges Stadsmissioner are advocating for regulatory changes to curb risky lending practices. Proposals include stricter credit assessments, making lenders more responsible, and potentially invalidating loans granted to individuals who clearly lack the ability to repay.