New knowledge from debt counsellor, DebtBusters, exhibits that debt publicity has worsened for most income teams in South Africa in comparison with latest years.
On common, shoppers have 20% extra unsecured debt in 2022 in comparison with 2016, these taking residence R20,000 or extra have unsecured debt ranges which can be 54% larger than in 2016, mentioned DebtBusters chief govt Benay Sager.
The monetary scenario of SA shoppers continues to be difficult, even two years after the starting of the coronavirus pandemic, he mentioned. “In absence of a meaningful increase in real
income, SA consumers continue to supplement their income with unsecured credit.”
The typical mortgage dimension has elevated by 27% in a number of years, and the variety of debt obligations (open trades) has decreased by 18% over the identical interval – each indicating that buyers have extra debt per credit score settlement and are in search of assist sooner, mentioned Sager.
In comparison with 2016, these shoppers who utilized for debt counselling in Q1 2022 had 31% much less disposable income. Sager mentioned that buyers must spend round 62% of their take-home pay to service their debt earlier than coming to debt counselling.
“More alarmingly, the debt-to-income ratio for the top two income bands is at its highest level recorded in Q1 2022 compared to the same periods in the past: 125% for those taking home more than R10,000 per month, and 150% for those taking home R20,000 or more each month.”
The debt to annual web income ratio for most income bands is at its highest stage ever for Q1 shoppers, he mentioned.
What individuals owe cash on
Car debt has elevated in the previous few years, indicating that extra shoppers with property (automobiles in explicit) are in search of monetary help, mentioned DebtBusters.