S AFRICAN CONSUMERS NOW OWE R1.72 TRILLION
CONSUMER debt in South Africa increased to R1.72 trillion in September. This is according to Experian’s Consumer Default Index for the third quarter, which increased from 3.76 percent in the second quarter to 3.93 percent. The increase in outstanding debt was mainly due to a deterioration in first-time defaulters, specifically across unsecured banking products (credit cards and personal loans). Personal loans showed the biggest increase year-on-year, from 8.03 percent in 2018 to 8.84 percent in 2019, with firsttime defaults amounting to R6.2 billion. First-time credit card defaulters similarly increased from 6.58 to 6.63 percent yearon-year, amounting to R2.2bn in balances defaulting for the first time since they were opened. “The deterioration in the unsecured banking product performance can be attributed to the increased demand for personal loans specifically, which are more broadly accessible across the various consumer market segments.
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