Newzroom Afrika<\/strong><\/a> that “the biggest issue we have seen over recent quarters is that consumers are under serious financial pressure.”<\/p>\n\n\n\n“Many households are facing significant financial challenges,” he added.<\/p>\n\n\n\n
The accessibility of credit through digital platforms has also played a role in the increased number of loan applications. <\/p>\n\n\n\n
Gwexe explained that before COVID-19, fewer people were using mobile phones or apps to apply for credit as they would predominantly go to branches. <\/p>\n\n\n\n
“But now, especially after COVID, many people are applying from home. They\u2019re applying to multiple institutions in an attempt to secure credit,” said Gwexe. <\/p>\n\n\n\n
Despite the surge in applications, the NCR emphasises that the majority of credit providers are adhering to affordability regulations. <\/p>\n\n\n\n
Out of the 18 million credit applications, 67.6% were rejected, indicating that lenders are scrutinising applications and ensuring that borrowers meet the necessary criteria.<\/p>\n\n\n\n
“This shows that the credit industry is not reckless and is adhering to guidelines set by the National Credit Regulator,” said Gwexe. <\/p>\n\n\n\n
“As the credit regulator, our goal is to ensure that consumers only receive credit that they can afford and repay on time, not just for the sake of taking on debt.”<\/p>\n\n\n\n
Gwexe also highlighted the importance of consumer honesty during the loan application process. <\/p>\n\n\n\n
“We also advise consumers to be honest when taking out loans and to declare all their expenses.” <\/p>\n\n\n\n
“If you hide some expenses during the application process and later find yourself unable to repay, the credit provider cannot be held liable,” said Gwexe.<\/p>\n\n\n\n
He emphasised the need for transparency, as it would be clear if a consumer misrepresented their financial situation.<\/p>\n\n\n\n
Honesty is crucial, as everything is traceable online.<\/p>\n\n\n\n
Gwexe said that NCR is actively addressing the rise in cyber security issues related to fake lenders. <\/p>\n\n\n\n
“Consumers need to ensure that any credit provider they engage with is registered with the National Credit Regulator,” said Gwexe.<\/p>\n\n\n\n
“They should always check the provider\u2019s registration number and confirm it with the NCR before proceeding,” he added.<\/p>\n\n\n\n
Additionally, the NCR cautioned against responding to unsolicited online credit offers, particularly from unfamiliar sources.<\/p>\n\n\n\n
Overall, the NCR’s data serves as a stark reminder of the financial challenges faced by many South African consumers. <\/p>\n\n\n\n
The combination of rising living costs, easy access to credit, and the proliferation of fraudulent lending schemes necessitate a cautious approach to borrowing and a commitment to financial responsibility.<\/p>\n\n\n\n
\n\n\n\nRead: National minimum wage backfire in South Africa<\/a><\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"The NCR reports record loan applications, rising arrears, and increased reliance on high-interest credit. <\/p>\n","protected":false},"author":101,"featured_media":792136,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11121],"tags":[6088,8427,853],"class_list":["post-807299","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-finance","tag-national-credit-regulator","tag-ncr","tag-south-africa"],"_links":{"self":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/807299","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\/101"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/comments?post=807299"}],"version-history":[{"count":7,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/807299\/revisions"}],"predecessor-version":[{"id":807441,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/807299\/revisions\/807441"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media\/792136"}],"wp:attachment":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media?parent=807299"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/categories?post=807299"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/tags?post=807299"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}