Meet the Ma family: How millennials are changing the way China thinks about money

Mon Dec 12, 2016 1:14am EST
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By Engen Tham and Adam Jourdan

SHANGHAI (Reuters) - Ma Yiqing, 24, is typical of China's younger generation - he uses his credit card frequently and borrows from online platforms to fund his shopping habits. In a pinch, he is happy to fall back on a lender closer to home - his mum and dad.

Interviews with Ma, a single-child, his mother and grandmother, show how rapidly attitudes toward credit are changing as the millennials generation - roughly those aged between 18 and 35 - embraces debt like never before.

The frugal attitude of previous generations produced the bedrock of China's credit worthiness - household savings equal to some 50 percent of GDP, one of the highest levels globally.

Ma and his cohorts are changing that equation. Their willingness to borrow has driven up household lending – the fastest growing area of China's debt. They are among the most indebted of their peers in Asia, taking on debt 18.5 times their income, significantly higher than their parents’ generation, a report from insurer Manulife shows.

While their spending and borrowing is an opportunity for lenders, brands and economic growth, it is also a risk as they add to China's fast-growing debt.

Right now, Ma has a safety net - well-heeled and doting parents who can pick up the tab. He lives in a one-bed flat in Lhasa, the capital of China's Tibet region. His parents are in nearby Shannan.

"I'll generally turn to mum and dad. They've always been able to help me financially," said Ma. In May, he asked his parents for financial support to open a restaurant. "I just need to ask and they'll give me (money)."


A woman shows her phone operating Ant Check, an Alibaba-linked platform, at a cafe in Beijing, China, April 11, 2016.  REUTERS/Shirley Feng/File Photo