Economists warn of tough times

ECONOMISTS have predicted a jobs bloodbath of over seven million in the country which will push many into debt, degrading their credit profiles.

Small and medium-sized businesses would also struggle to get back on their feet, while banks would find it hard to grant loans due to junk status.

Benay Sager, chief operating officer at Debtbusters, a debt counselling company, has encouraged consumers to consider debt counselling ahead of “tough times”.

He said a survey had shown that many households were facing financial hardship as a result of the Covid-19 and lockdown of the economy.

Sager revealed that many consumers who were struggling to make ends meet were often reluctant to seek help, either because they didn’t know where to turn to or because they were embarrassed.

“The lockdown probably forced many consumers to assess their financial situation. Some will have realised how much difficulty they are in, but they might be reluctant to seek help either because they don’t know where to turn or are embarrassed.

“People in this situation should understand they’re not alone. There are options and they need to act before they face the possibility of their house, cars or other assets being repossessed.

“Debt counselling is one of these options. South Africa is fortunate to have a debt counselling sector that is considered world-class. It is highly regulated, efficient and effective,” Sager said.