"Get credit for free!" the catchy jingle on a Moscow radio station exhorts, tempting listeners to apply for a credit card. If "you can't pay off your balance, you only have to pay a 'modest' interest rate," it promises.
Only 12 years since the collapse of communism, a small but growing number of Russians are starting to take out bank loans to buy homes, cars, television sets and now can use plastic to go on that dream seaside holiday.
Most of the new breed of consumers are concentrated in the capital Moscow, a boom town with sushi bars and chic clothes shops in a city center where a free-spending middle-class has risen from the ashes of Russia's 1998 financial crash.
"Credit is a new product which is becoming increasingly popular," said Michel Perhirin, head of the Russian subsidiary of Austria's Raiffeisen Bank, which has played a leading role in developing the loan market here.
"Russians have had very little use for it in the past, they relied on cash. But interest rates have dropped to reasonable levels, and a loan is a good alternative to paying upfront," he said.
Suspicious of banks after the financial meltdown in 1998, people in Russia have kept their savings at home, where an estimated $75 billion is now stashed. Property is usually paid for with a lump sum.
But spurred by the arrival of Western financial institutions into the retail banking sector, and thanks to the financial stability that has followed the 2000 election of President Vladimir Putin, loans are becoming more commonplace.
"Four years have passed since the financial crisis, and people trust banks more, especially Western-backed ones," said Victoria Kochetkova, head of public relations at the U.S.-funded Delta Credit, a competitor of Raiffeisen.
"Property is getting more expensive now, and people need to borrow to afford it," she pointed out.
The state-owned savings bank Sberbank, which controls 70 percent of retail deposits, also dominates mortgage lending. It extended more than $900 million worth of ruble-denominated loans to individuals in 2001.
In contrast, in the four years since it started business, Delta Credit has handed out $53 million of home loans to just 1,400 people, who on average borrowed $40,000 - $45,000.
Raiffeisen hopes to expand its mortgage portfolio to $50 million and issue $40 million in car loans by the end of 2003.
But the Western banks are the top choice among well-heeled inhabitants of Moscow and St. Petersburg and have led the way in bringing mortgage interest rates down to 12 percent for dollar-denominated loans.
Ordinary Russians, meanwhile, are turning to private Russian banks to allow them to buy consumer goods such as fridges, washing-machines, televisions and video recorders.
Leading household appliance retailer M Video, which has branches in Moscow and in four other Russian cities, Nizhny Novgorod, Samara, Rostov-on-Don and Yekaterinburg, now makes 30 percent of its sales on credit.
"Most of our customers are middle-class and pay in cash, but those who earn smaller salaries now also have the chance to buy these goods using credit," spokeswoman Maria Belan said.
Russian Standard Bank, which works with M Video, has lent $270 million for consumer purchases in the last few years.
At a glance, the potential for consumer credit in Russia seems limited, given that the average salary even in Moscow is officially calculated at 6,500 rubles per month.
But according to Expert magazine and Monitoring.ru, an Internet consultancy, over 10 million families in Russia earn between $6,000 - $40,000 per year, with much of this income undeclared.
In a sign of the times, this month Raiffseisen launched unsecured consumer loans, up to a maximum of $10,000, at an annual interest rate of 14 percent — not much above what is offered in the West.
And Russian banks are starting to issue credit cards.
Since April 2001 Russian Standard Bank has signed up 140,000 credit card holders in Moscow and the surrounding region and plans to expand the scheme to other cities this year.
On average the bank gives credit limits of $1,000, and it charges a hefty 29 percent annual interest for ruble-denominated debt, which has alarmed some commentators.
"Full-blown capitalism has appeared. We got the opportunity to participate fully in the consumerist orgy like citizens of Western countries," said the trendy Moscow listings magazine, Afisha.
"Credit is like heroin. At first they give it out easily, sometimes even virtually free, but one day it's payback time," it warned.