Consumers resort to borrowing to buy groceries

South Africans grappling with the burden of escalating living expenses are now going into debt to pay for their groceries.

This is according to FinMark Trust’s annual FinScope Consumer South Africa 2023 report, released on Tuesday. The report shows that 40% of South African adults borrow money to purchase food.

The data comes as the Pietermaritzburg Economic Justice & Dignity Group’s (PMBEJD) monthly household affordability index shows that in April, the average household basket costs R5 336.31. This represents a month-on-month increase of R58.38 (1.1%) compared to March when it cost R5 277.93. It is also a year-on-year increase of R312.26 (6.2%) from April last year, when it cost R5 023.95.

According to PMBEJD’s report, the increase in this month’s household food basket was primarily driven by higher vegetable prices, especially onions. Furthermore, 27 foods’ prices rose this month while 17 decreased.

With the national minimum wage at R27.58 per hour, which equates to R220.64 for an eighthour workday and R4 633.44 for the typical 21-day work month, an individual earning this would find it challenging to afford an average household food basket, further confirming FinMark’s finding.

FinMark’s report also reveals that 30 million (68%) South Africans receive social grants. While these grants serve as a lifeline for many, they often fall short of covering basic needs.

For instance, the child support grant is R530, whereas the average cost of a basic nutritional basket for children is R959.38, and the food poverty line, as calculated by Statistics SA, is R760 per capita per month. This indicates that the child support grant falls 30% below the food poverty line and 45% below the average cost needed to secure a basic nutritious diet for a child.

The report has uncovered a range of concerning findings, with food insecurity being just one of them. FinMark’s data shows nearly 20 million South Africans struggle to afford electricity.