A year after taking out a loan in Buenos Aires, Andrea is overwhelmed by shame because she can no longer pay it back.

And she is not alone.

Debt delinquency among Argentine families has tripled in a year, reaching its highest level in two decades under President Javier Milei, a radical free-market champion whose draconian austerity measures have curbed inflation but left many struggling to make ends meet.

Some 5.8 million people are more than 90 days behind on their debt payments, according to the Central Bank of Argentina.

Stagnant incomes, coupled with a cost of living crisis – due in part to Milei slashing subsidies for transportation, gas, medicine and other essentials – have nudged household finances to the brink.

Andrea, a 32-year-old mother who declined to give her surname because she felt ashamed of her predicament, tried to reinvent herself by starting a catering business after the stationery shop where she worked shut down.

But the purchase of a new oven landed her in hot water.

"I fell behind on payments, and in a couple of months the debt became too big to repay. It went from one million pesos (about $670) to five million (about $3,360)," she said.

No 'gun to their head'

In total, some 21 million people, out of Argentina's population of 46 million, have some type of debt, according to the Central Bank.

Milei has rejected any responsibility for the situation.

"Did they have a gun to their head to make them do it (take out a loan)?" he asked curtly in a recent interview.

The president of Buenos Aires' Banco Provincia, Juan Cuattromo, rejects the notion that Argentines are themselves to blame for getting in over their heads.

He told Agence France-Presse (AFP) debt delinquency was "not a consequence of individual decisions" but the result of "a macroeconomic context that has worsened incomes, employment and economic activity."

Interest rates of 1,000%

Personal loans and credit cards account for more than 70% of unpaid loans, according to a report by the Center for Argentine Political Economy.

"I go to bed and wake up thinking about how I'm going to pay," Claudia Debaste told AFP, referring to her credit card bill.

Debaste, a 40-year-old single mother who works a low-pay office job, ran up a large bill on utilities, transportation, groceries and medicine.

She fell behind on her payments four months ago and is now seeking to reschedule her debt.

Milei has been hailed for his success in fighting high inflation, Argentina's perennial bugbear, but slower price increases are a double-edged sword for people living on credit, as it means their loans retain their value over time.

Longer repayments – coupled with higher bills and stagnant wages – have created the perfect storm for many families.

The debt crisis coincides with the rise of easy access to credit from digital wallets such as Mercado Pago, the digital payment arm of e-commerce giant Mercado Libre.

Fintech companies have drawn in adolescents as young as 13, telling them they no longer need to be adults to gain access to "instant cash."

But eye-watering interest rates soon land them in a debt spiral.

Gabriel Solano, leader of the Workers' Party, filed a criminal complaint last week against Marcos Galperin, CEO of Mercado Libre, for usury.

"The total effective financial cost (of a loan from Mercado Pago) stands at 1,375%," Solano wrote on the social media platform X.

Teenage debtors

The offer of credit, with few conditions attached, has also sucked in workers from the gig economy, with the platforms for which they work sometimes acting as their lenders.

Their rates start at 260% annually, quadruple those of banks, with the payments deducted from the workers' earnings.

Those who don't pay risk having their account on the platform blocked, effectively putting them out of business.

"It's like being fired," Leandro Hidalgo, a delivery driver and union representative, told AFP, accusing the platforms of "financial slavery."