BUENOS AIRES, Argentina — At 18, Martín Taborda stepped into the Faculty of Law at Argentina’s iconic University of Buenos Aires, carrying his family’s hope that he would become the first member of his household to earn a university degree. Just two years later, that ambition has collapsed under the weight of growing economic hardship.
Unemployed and carrying $1,300 in outstanding debt, Taborda can no longer cover even the basic costs of his education: the daily bus fare from his working-class suburb to the central campus, and the textbooks required for his courses. This struggle plays out even at UBA, a tuition-free public institution that has lifted generations of working-class Argentines into the middle class.
Taborda’s story is far from unique. Data from the Center for City Studies, an Argentine non-profit that analyzes central bank economic data, shows that nearly half of Argentina’s 45 million residents currently hold outstanding debt, with more than 5 million borrowers behind on their monthly payments. Borrowers under the age of 25 face the highest delinquency rate of any age demographic, hitting 37.6% of all young borrowers.
“There is barely any work available for anyone in this country right now,” Taborda explained. He originally took out a $100 equivalent loan via a popular digital mobile payment app in 2024 to cover school expenses, but compound interest on missed payments swelled his balance to 10 times the original borrowed amount. Forced to depend on friends and family to get by, he described the emotional toll: “You start to feel like a parasite.”
This growing crisis of household survival debt has emerged as a major political challenge for President Javier Milei, eroding support among the young voters who were key to his 2023 election victory, and handing Argentina’s fragmented opposition an opening to mobilize disillusioned voters ahead of the 2027 presidential election.
Opposition lawmakers have called a special congressional session this Wednesday to debate emergency legislation, including proposals to cap predatory lending interest rates and create structured frameworks to help struggling borrowers renegotiate their outstanding balances. Labor unions and grassroots debtor advocacy groups have planned a public protest outside Congress during the debate, a direct challenge to the core principles of Milei’s radical free-market economic agenda. The shift in voter concern comes even as Milei can claim a major policy win in taming decades-high runaway inflation, with voters now prioritizing urgent struggles over jobs, stagnant wages, and household affordability.
In their legislative proposal, left-wing lawmaker Nicolás del Caño and co-sponsors framed the bill as a necessary response to a national emergency, writing, “Households took on debt just to survive, and now they cannot repay it.”
Milei has flatly rejected calls for government intervention, arguing that unpaid debts are a private matter between individual borrowers and lending institutions, not a symptom of broader systemic economic failure. Economy Minister Luis Caputo recently told reporters that private banks have already agreed to loosen repayment terms for struggling borrowers, but added, “We shouldn’t confuse empathy with public policy.”
On a recent weekday afternoon, Taborda joined a group of several dozen fellow University of Buenos Aires students in an economics department classroom for a confidential support group focused on the emotional and financial toll of unmanageable student and household debt. The meeting follows the anonymity-centered structure of Alcoholics Anonymous, designed to reduce the stigma around debt distress. When the moderator asked for a show of hands on three key questions — who had bought groceries on installment payment plans, who had borrowed via digital apps to cover basic needs, and who had taken out new debt to pay off old loans — the vast majority of attendees raised their hands.
Since taking office in late 2023 on a promise to dismantle Argentina’s decades-long discredited political and economic establishment, Milei has delivered on his core promise of cutting runaway inflation. He slashed the federal budget deficit and brought annual inflation down from a peak of 289% in early 2024 to roughly 34% by July 2025. This new macroeconomic stability has encouraged private banks to expand lending, but steep government cuts to long-standing subsidies for gas, electricity, and public transportation have driven utility and transit costs far faster than household incomes can keep up, forcing millions of Argentines to borrow just to cover daily basic needs.
In previous eras of high inflation in Argentina, regular wage increases tied to rising prices gradually reduced the real burden of fixed loan payments. Today, slower inflation means far smaller annual pay adjustments, while sky-high borrowing costs remain in place as part of the government’s tight monetary policy designed to keep inflation in check. Digital mobile payment apps, which have become the primary lending source for low-income and young Argentines, require far less paperwork than traditional banks but charge exorbitant interest rates — often reaching three digits annually — to offset higher default risk.
Vanesa Bittoco, a spokesperson for grassroots advocacy group Organized Debtors, which campaigns for flexible repayment plans tied to borrower incomes, explained how the nature of household borrowing has shifted dramatically in Argentina: “There was a time when people took out loans to buy a house, an apartment, a car. Now people take out loans to buy food to make it to the end of the month.”
At the students’ debt support meeting, attendees described feeling trapped, deeply ashamed, and increasingly hopeless about their long-term futures. This psychological distress extends far beyond university campuses: data from the University of Buenos Aires’ Applied Social Psychology Observatory shows that more than 80% of adults surveyed in Buenos Aires and its surrounding suburbs in April 2025 reported that ongoing economic crisis had severely harmed their mental well-being.
Political analysts warn that the growing household debt crisis could significantly erode Milei’s support among young voters as he campaigns for a second term in the 2027 presidential election, now just 14 months away.
“Clearly, the current economic model is hitting young people much harder than other segments of the Argentine population,” said Ana Iparraguirre, a public opinion consultant and partner at Washington-based global strategy firm GBAO. “If this crisis continues, Milei is putting his reelection at risk with the same electorate that helped him win office.”
Milei has shown little sympathy for struggling borrowers, publicly blaming the surge in delinquencies on irresponsible consumer spending. “They bought TVs to watch the World Cup and figured they’d decide later whether to pay,” he told a gathering of investors in the port city of Rosario last month. “Well, now they haven’t paid.”
The debt crisis comes as Milei’s overall national approval rating has already dropped sharply. A recent nationally representative online poll of 1,500 respondents conducted by prominent Argentine pollster Zuban Córdoba put Milei’s job approval at just 33%, down from 49% in December 2025. A majority of respondents reported that they are worse off financially today than they were when Milei first took office. The poll, fielded from July 22 to 26, 2025, has a margin of sampling error of plus or minus 2.5 percentage points.
For advocates like Bittoco, the government will be forced to act to address the crisis: “They’re going to have to provide a solution. Otherwise, they’re the ones who will have a problem.”
