What effects do interest rates have on credit access?

Interest rates significantly impact credit access by altering affordability and lending criteria. As interest rates rise, higher borrowing costs result in larger monthly repayments, potentially causing financial stress for consumers and leading to increased defaults. Consequently, lenders are enforcing stricter creditworthiness criteria, making access to credit more challenging, especially for those with weaker financial backgrounds^[1][4].

Moreover, the European Central Bank has seen its interest rates reach historical highs, prompting lenders to prioritize stricter credit qualification standards, focusing more on credit scores and debt-to-income ratios to manage risk effectively in a changing economic landscape^[2][3].