{"id":730265,"date":"2023-11-09T15:09:54","date_gmt":"2023-11-09T13:09:54","guid":{"rendered":"https:\/\/businesstech.co.za\/news\/?p=730265"},"modified":"2023-11-09T15:09:54","modified_gmt":"2023-11-09T13:09:54","slug":"south-africans-are-shooting-themselves-in-the-foot","status":"publish","type":"post","link":"https:\/\/businesstech.co.za\/news\/banking\/730265\/south-africans-are-shooting-themselves-in-the-foot\/","title":{"rendered":"South Africans are shooting themselves in the foot"},"content":{"rendered":"\n<p>South Africans may be battling a challenging economic environment, but many respond in a way that makes things much worse for themselves. <\/p>\n\n\n\n<p>South African banking clients have been distressed amidst sustained interest rate hikes since November 2021. <\/p>\n\n\n\n<p>However, consumers often wait too long to find a way out of their financial predicament and avoid approaching their bank. <\/p>\n\n\n\n<p>&#8220;Because consumers perceive banks as being driven solely by profit and just \u2018after our money\u2019, it is a common psychological trait for clients to shy away from approaching their bank \u2013 especially when they are facing financial difficulties or have missed a payment \u2013 because of a natural tendency to avoid a potentially distressing situation,&#8221; said Nozizwe Tshabuse, Nedbank&#8217;s Managing Executive for Client Debt Management and Recoveries. <\/p>\n\n\n\n<figure class=\"wp-block-embed is-type-wp-embed is-provider-businesstech wp-block-embed-businesstech\"><div class=\"wp-block-embed__wrapper\">\n<blockquote class=\"wp-embedded-content\" data-secret=\"zJb3CzxXVa\"><a href=\"https:\/\/businesstech.co.za\/news\/property\/730205\/south-africans-cant-afford-their-homes\/\">South Africans can&#8217;t afford their homes<\/a><\/blockquote><iframe loading=\"lazy\" class=\"wp-embedded-content\" sandbox=\"allow-scripts\" security=\"restricted\" style=\"position: absolute; clip: rect(1px, 1px, 1px, 1px);\" title=\"&#8220;South Africans can&#8217;t afford their homes&#8221; &#8212; BusinessTech\" src=\"https:\/\/businesstech.co.za\/news\/property\/730205\/south-africans-cant-afford-their-homes\/embed\/#?secret=delaFcd4hK#?secret=zJb3CzxXVa\" data-secret=\"zJb3CzxXVa\" width=\"500\" height=\"282\" frameborder=\"0\" marginwidth=\"0\" marginheight=\"0\" scrolling=\"no\"><\/iframe>\n<\/div><\/figure>\n\n\n\n<p>Tshabuse said that several trends have been observed in how clients approach their debt and how this impacts their financial health in the future. <\/p>\n\n\n\n<p>For instance, the &#8220;<strong>committed player<\/strong>&#8221; resists seeing themselves as defaulters or non-payers. This means that they remain determined to pay despite their unforeseen inability to meet repayment obligations. <\/p>\n\n\n\n<p>This is then worsened by the &#8220;<strong>ostrich effect<\/strong>&#8220;, where clients bury their heads in the sand. These clients often ignore information or communication such as SMSs, calls and even bank statements. <\/p>\n\n\n\n<p>This leads to a disconnect between changes to monthly instalments as interest rates increase, resulting in accumulative arrears. This also leads to consumers not knowing what relief options they have. <\/p>\n\n\n\n<p>There is also <strong>procrastination, overconfidence and optimism,<\/strong> where clients delay addressing their financial troubles in the hope that a financial windfall, such as bonuses, will rescue them. <\/p>\n\n\n\n<p>These consumers ignore the potential damage that delay has on their credit history and record. <\/p>\n\n\n\n<p class=\"has-medium-font-size\"><strong>Turning to debt <\/strong><\/p>\n\n\n\n<p>A great irony over the fact that South Africans cannot service their debt is that more are turning to debt to contain the knocks on their disposable income. <\/p>\n\n\n\n<p>This is according to the NedFinHealth Monitor, which quantified South Africa&#8217;s financial health score to 53 out of 100. <\/p>\n\n\n\n<p>When debt reaches uncontrollable levels, this leads to financial shame, deterring customers from seeking financial help. <\/p>\n\n\n\n<p>However, financial institutions do have several ways to aid customers, with Nedbank assisting 9,000 South Africans in retaining their homes and helping over 80,000 people avoid losing their cars. <\/p>\n\n\n\n<p>\u201cUltimately, the bank is not just a bank; it is a partner in its clients\u2019 financial journey,&#8221; Tshabuse said. <\/p>\n\n\n\n<hr class=\"wp-block-separator has-alpha-channel-opacity\"\/>\n\n\n\n<p><strong>Read<\/strong>: <a href=\"https:\/\/businesstech.co.za\/news\/lifestyle\/730163\/this-is-how-much-south-africans-spend-on-movies-video-games-streaming-services-and-more\/\" target=\"_blank\" rel=\"noreferrer noopener\">This is how much South Africans spend on movies, video games, streaming services and more<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>South Africa is facing a cost of living crisis &#8211; but a lack of agency from consumers is making the problem worse. <\/p>\n","protected":false},"author":95,"featured_media":671195,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[961],"tags":[26,1799],"class_list":["post-730265","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-banking","tag-headline","tag-nedbank"],"_links":{"self":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/730265","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/users\/95"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/comments?post=730265"}],"version-history":[{"count":5,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/730265\/revisions"}],"predecessor-version":[{"id":730283,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/730265\/revisions\/730283"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media\/671195"}],"wp:attachment":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media?parent=730265"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/categories?post=730265"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/tags?post=730265"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}