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Fintech Stocks Slide Amid Tariff Uncertainty

Market Volatility Raises Concerns Over Consumer Credit and Loan Repayments. Financial technology companies—including Robinhood and buy now, pay later (BNPL) provider Affirm—have been caught in the crosshairs of President Donald Trump’s sweeping tariff policy, with shares tumbling as investors brace for economic uncertainty.

Fintech Faces Growing Pressure

Since Trump’s April 2 tariff announcement, global markets have been rattled, sparking fears of higher consumer prices, weaker demand, and a potential recession. Fintech firms, which rely on consumer spending and loan repayments, are particularly vulnerable to economic downturns.

  • Affirm (AFRM.O) shares have dropped over 21%, reflecting investor concerns over BNPL customers’ ability to repay loans.
  • Robinhood (HOOD.O) is down more than 17%, as its revenue from debit and credit card transactions could decline with softer consumer spending.
  • SoFi (SOFI.O) has lost nearly 20%, given its exposure to personal loans and banking services.

“A recession typically hits mass-market consumer businesses—including fintechs—harder than other sectors, as lower-income consumers cut back first,” said James Ulan, director of research at PitchBook.

Delinquencies On The Rise?

For credit-extending fintechs like Affirm and SoFi, the key concern is rising delinquency rates.

  • Affirm reported 2.5% of its monthly loans were delinquent by over 30 days as of December 31—slightly up from the previous year.
  • SoFi said 0.55% of its personal loans were delinquent by more than 90 days in the same period.
  • For comparison, banks reported a 2.75% delinquency rate on consumer loans, according to the Federal Reserve.

“With renewed inflation, excess cash flows are squeezed, and the ability to service debt weakens,” said John Hecht, analyst at Jeffries.

A Silver Lining?

Despite the turbulence, some analysts see a potential upside. If tariffs push Treasury yields lower, borrowing costs for fintech lenders could drop, making credit extension less risky.

“This could have unintended positive consequences for fintech stocks,” said Dan Dolev, senior analyst at Mizuho, arguing that markets may be overreacting.

Investors are also watching for potential negotiations on tariffs, which could ease recession fears and help stabilize fintech stocks.

“The real damage so far is mostly psychological,” said Nick Thompson, research analyst at Intro-act. “If we see quick relief, markets could rebound fast.”

Cyprus Income Distribution 2024: An In-Depth Breakdown of Economic Classes

New findings from the Cyprus Statistical Service offer a comprehensive analysis of the nation’s income stratification in 2024. The report, titled Population By Income Class, provides critical insights into the proportions of the population that fall within the middle, upper, and lower income brackets, as well as those at risk of poverty.

Income Distribution Overview

The data for 2024 show that 64.6% of the population falls within the middle income class – a modest increase from 63% in 2011. However, it is noteworthy that the range for this class begins at a comparatively low threshold of €15,501. Meanwhile, 27.8% of the population continues to reside in the lower income bracket (a figure largely unchanged from 27.7% in 2011), with nearly 14.6% of these individuals identified as at risk of poverty. The upper income class accounted for 7.6% of the population, a slight decline from 9.1% in 2011.

Income Brackets And Their Thresholds

According to the report, the median equivalent disposable national income reached €20,666 in 2024. The upper limit of the lower income class was established at €15,500, and the threshold for poverty risk was set at €12,400. The middle income category spans from €15,501 to €41,332, while any household earning over €41,333 is classified in the upper income class. The median equivalents for each group were reported at €12,271 for the lower, €23,517 for the middle, and €51,316 for the upper income classes.

Methodological Insights And Comparative Findings

Employing the methodology recommended by the Organisation for Economic Co-operation and Development (OECD), the report defines the middle income class as households earning between 75% and 200% of the national median income. In contrast, incomes exceeding 200% of the median classify households as upper income, while those earning below 75% fall into the lower income category.

Detailed Findings Across Income Segments

  • Upper Income Class: Comprising 73,055 individuals (7.6% of the population), this group had a median equivalent disposable income of €51,136. Notably, the share of individuals in this category has contracted since 2011.
  • Upper Middle Income Segment: This subgroup includes 112,694 people (11.7% of the population) with a median income of €34,961. Combined with the upper income class, they represent 185,749 individuals.
  • Middle Income Group: Encompassing 30.3% of the population (approximately 294,624 individuals), this segment reports a median disposable income of €24,975.
  • Lower Middle And Lower Income Classes: The lower middle income category includes 22.2% of the population (211,768 individuals) with a median income of €17,800, while the lower income class accounts for 27.8% (267,557 individuals) with a median income of €12,271.

Payment Behaviors And Economic Implications

The report also examines how income levels influence repayment behavior for primary residence loans or rental payments. Historically, households in the lower income class have experienced the greatest delays. In 2024, 27.0% of those in the lower income bracket were late on payments—a significant improvement from 34.6% in 2011. For the middle income class, late payments were observed in 9.9% of cases, down from 21.4% in 2011. Among the upper income class, only 3% experienced delays, compared to 9.9% previously.

This detailed analysis underscores shifts in income distribution and repayment behavior across Cyprus, reflecting broader economic trends that are critical for policymakers and investors to consider as they navigate the evolving financial landscape.

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