{"id":733377,"date":"2023-11-24T08:23:15","date_gmt":"2023-11-24T06:23:15","guid":{"rendered":"https:\/\/businesstech.co.za\/news\/?p=733377"},"modified":"2023-11-24T08:23:15","modified_gmt":"2023-11-24T06:23:15","slug":"interest-rate-relief-not-enough-for-indebted-south-africans","status":"publish","type":"post","link":"https:\/\/businesstech.co.za\/news\/finance\/733377\/interest-rate-relief-not-enough-for-indebted-south-africans\/","title":{"rendered":"Interest rate relief not enough for indebted South Africans"},"content":{"rendered":"\n<p>Businesses and consumers may have welcomed South Africa&#8217;s recent interest rate hold, but the pain at the till is not going away anytime soon. <\/p>\n\n\n\n<p>The South African Reserve Bank (SARB) kept interest rates on hold yesterday, 23 November, with the repo rate steady at 8.25% &#8211; in line with economist predictions. <\/p>\n\n\n\n<p>This was despite inflation ticking up from 5.4% in September to 5.9% in October. <\/p>\n\n\n\n<p>Stats SA said that inflated transport costs and higher food prices &#8211; following the panic buying of poultry products following the bird flu outbreak &#8211; were the main reasons for the increase in the headline figure. <\/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=\"A467WwiZ7a\"><a href=\"https:\/\/businesstech.co.za\/news\/lifestyle\/732769\/petrol-prices-and-panic-sends-inflation-shooting-up-in-south-africa\/\">Petrol prices and panic sends inflation shooting up in South Africa<\/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;Petrol prices and panic sends inflation shooting up in South Africa&#8221; &#8212; BusinessTech\" src=\"https:\/\/businesstech.co.za\/news\/lifestyle\/732769\/petrol-prices-and-panic-sends-inflation-shooting-up-in-south-africa\/embed\/#?secret=035XkAN8zh#?secret=A467WwiZ7a\" data-secret=\"A467WwiZ7a\" width=\"500\" height=\"282\" frameborder=\"0\" marginwidth=\"0\" marginheight=\"0\" scrolling=\"no\"><\/iframe>\n<\/div><\/figure>\n\n\n\n<p>Neil Roets, CEO of\u00a0Debt Rescue,\u00a0said that the persistent increases in food prices are forcing more consumers to take out credit to pay their monthly grocery bills. <\/p>\n\n\n\n<p>\u201cThis is a dangerous trend and definitely not a long-term solution,\u201d Roets warned.<\/p>\n\n\n\n<p>He added that the steady increase in interest rates earlier this year led to a steep increase in loan instalments, resulting in more owners defaulting on vehicle and home repayments. <\/p>\n\n\n\n<p>\u201cDistressed house sales are on the rise in South Africa, as the majority of sellers are downgrading due to financial pressure,\u201d he added.<\/p>\n\n\n\n<p><a rel=\"noreferrer noopener\" href=\"https:\/\/businesstech.co.za\/news\/property\/727260\/south-africans-are-giving-up-their-homes-heres-why\/\" target=\"_blank\">Lightstone<\/a> data supports this, with the number of homeowners selling their properties within two years of purchase having jumped from 2% of sales in May 2022 to 3.7% of sales a year later &#8211; primarily due to increased living costs and the larger number of homeowners in debt traps following the pandemic. <\/p>\n\n\n\n<p>In addition, the average consumer needs to spend roughly <a rel=\"noreferrer noopener\" href=\"https:\/\/businesstech.co.za\/news\/lifestyle\/731555\/trouble-mounting-for-south-africans-earning-over-r35000-a-month\/\" target=\"_blank\">63%<\/a> of their take-home pay to service their debt, with those earning R35,000 or more a month paying 67% of their income on debt repayments. <\/p>\n\n\n\n<p>The latest NedFinHealth Monitor shows that 69% of South Africans cannot pay their bills on time, whilst 33% could not even pay their home loan over the last year. <\/p>\n\n\n\n<p>Roets said that there will likely be a higher number of defaults in the coming months, including those on bank loans and credit facilities.<\/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\/banking\/730265\/south-africans-are-shooting-themselves-in-the-foot\/\" target=\"_blank\" rel=\"noreferrer noopener\">South Africans are shooting themselves in the foot<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Debt Rescue says the SARB&#8217;s recent interest rate decision cannot hide the plethora of issues facing South African consumers.  <\/p>\n","protected":false},"author":95,"featured_media":700863,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11121],"tags":[6172,26],"class_list":["post-733377","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-finance","tag-debt-rescue","tag-headline"],"_links":{"self":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/733377","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=733377"}],"version-history":[{"count":5,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/733377\/revisions"}],"predecessor-version":[{"id":733409,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/733377\/revisions\/733409"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media\/700863"}],"wp:attachment":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media?parent=733377"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/categories?post=733377"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/tags?post=733377"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}