The latest data from the National Credit Regulator (NCR) shows that South African consumer debt has increased to R1.63 trillion in the second quarter of the year.
Worryingly, despite a majority of credit active consumers are in good standing with debt payments, almost 45% are struggling to meet their repayments.
According to data from debt management firm, Debt Rescue, in August, consumers owe as much as three quarters (75%) of their monthly pay to creditors.
Over 56% and 58% of consumers struggling to pay off home loans and credit card debt, respectively, increasing the need for debt counselling, the group said.
Putting south Africa’s consumer debt into perspective, the amount equates to $118 billion – this is larger than the total GDP output of some countries, such as Angloa ($107 billion), and in range of Morocco ($130 billion).
The amount is equal to about a third of South Africa’s GDP output, which is at around $350 billion (World Bank data, 2014).
South Africa’s debt data at a glance.
- South Africa’s debt to financial institutions totals R1.63 trillion
- Mortages account for R857 billion
- Asset-backed credit accounts for R357 billion
- In the first quarter of 2015, South Africans added R108 billion in new credit
- In the second quarter, R112 billion of new credit was added
- Banks grant the biggest share of credit, followed by retailers and non-bank financiers
- There are currently 23.37 million credit active consumers
- 12.8 million credit active consumers are in good standing
- 10.5 million credit active consumers have impaired records
- Average debt per credit active consumer is at R69,750