South Africans are the most hard-up for cash, ranking as the top country for loans taken out in the past year.<\/p>\n
According to data from the World Bank, on average, two in five people around the world took out a loan in 2013-14, with South Africa being the world\u2019s number one country for people needing loans.<\/p>\n
86% of adults in the country took out loans during that year, ahead of Iran (80%), Uganda and Kenya (79%), Niger (71%) and the Philippines\u00a0(70%).<\/p>\n
In March, it was reported that half of 19 million credit-active South Africans had impaired credit records, three months plus in arrears, while\u00a015%\u00a0are described as debt stressed, one to two months in arrears.<\/p>\n
As a result, more than 11 million of South Africa\u2019s credit active consumers are described as over-indebted.<\/p>\n
| #<\/th>\n | Country<\/th>\n | % of population taking loans<\/th>\n<\/tr>\n | ||||||||||||||||||||||||||||||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 1<\/td>\n | South Africa<\/td>\n | 86%<\/td>\n<\/tr>\n | ||||||||||||||||||||||||||||||||||||||||||||||||
| 2<\/td>\n | Iran<\/td>\n | 80%<\/td>\n<\/tr>\n | ||||||||||||||||||||||||||||||||||||||||||||||||
| 3<\/td>\n | Kenya<\/td>\n | 79%<\/td>\n<\/tr>\n | ||||||||||||||||||||||||||||||||||||||||||||||||
| 4<\/td>\n | Uganda<\/td>\n | 79%<\/td>\n<\/tr>\n | ||||||||||||||||||||||||||||||||||||||||||||||||
| 5<\/td>\n | Niger<\/td>\n | 71%<\/td>\n<\/tr>\n | ||||||||||||||||||||||||||||||||||||||||||||||||
| 6<\/td>\n | Philippines<\/td>\n | 70%<\/td>\n<\/tr>\n | ||||||||||||||||||||||||||||||||||||||||||||||||
| 7<\/td>\n | Iraq<\/td>\n | 69%<\/td>\n<\/tr>\n | ||||||||||||||||||||||||||||||||||||||||||||||||
| 8<\/td>\n | Botswana<\/td>\n | 69%<\/td>\n<\/tr>\n | ||||||||||||||||||||||||||||||||||||||||||||||||
| 9<\/td>\n | Zambia<\/td>\n | 68%<\/td>\n<\/tr>\n | ||||||||||||||||||||||||||||||||||||||||||||||||
| 10<\/td>\n | Malawi<\/td>\n | 66%<\/td>\n<\/tr>\n | ||||||||||||||||||||||||||||||||||||||||||||||||
| 11<\/td>\n | Yemen<\/td>\n | 66%<\/td>\n<\/tr>\n | ||||||||||||||||||||||||||||||||||||||||||||||||
| 12<\/td>\n | Israel<\/td>\n | 64%<\/td>\n<\/tr>\n | ||||||||||||||||||||||||||||||||||||||||||||||||
| 13<\/td>\n | Cambodia<\/td>\n | 62%<\/td>\n<\/tr>\n | ||||||||||||||||||||||||||||||||||||||||||||||||
| 14<\/td>\n | Burundi<\/td>\n | 60%<\/td>\n<\/tr>\n | ||||||||||||||||||||||||||||||||||||||||||||||||
| 15<\/td>\n | Bahrain<\/td>\n | 60%<\/td>\n<\/tr>\n<\/tbody>\n<\/table><\/div>\n<\/div>\n The World Bank data is based on the responses of 150,000 adults in 143 countries, talking about how and why they access financial services.<\/p>\n The poorest suffer the most<\/h3>\nWhen South Africans run into financial trouble, the most popular go-to destination is family, where 22% of adults indicated that they would turn to their families to borrow money.<\/p>\n Savings accounts (22%) were the next best bet, followed by seeing aid from employers (4%), personal lenders (2%) and financial institutions (1%).<\/p>\n Lenders in South Africa have come into the spotlight in the past for being too ‘liberal’ with small, unsecured loans, particularly among the poorer communities.<\/p>\n Unsecured lending and micro-loan schemes were identified as major problems that plagued Marikana in the North West during the labour unrest in August 2012.<\/p>\n Of the poorest 40% in South Africa, 87% of adults had to borrow money in 2014 – also the highest rate in the world.<\/p>\n Historically, in South Africa, the poor had been unable to obtain loans because they had no assets as security, which was where micro and unsecured lending had stepped in.<\/p>\n However, research by the SA Human Rights Commission (SAHRC) indicated that these types of loans are being used for consumption.<\/p>\n With a faltering economy, cash-strapped consumers were struggling to pay back loans, and getting trapped in a poverty cycle and debt trap.<\/p>\n In 2009, studies showed that 40% of the money from micro finance was used to buy food and many borrowers were taking new loans to pay old ones, the SAHRC said.<\/p>\n From 2007 to 2012, outstanding unsecured credit in South Africa increased from R41 billion to R159 billion.<\/p>\n The World Bank data shows that South Africa has the highest proportion of borrowing from informal lenders among the poorest 40% of the population out of all the countries in the world, at 24%.<\/p>\n Countries with the highest level of informal lending among the poorest 40%<\/h3>\n
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