R13.6bn Worth of Consumer Accounts Not Paid on Time in July 2017
According to Experian’s newly launched Consumer Default Index, around R13.6bn worth of consumer debt was not paid in July of 2017.
Experian measures debt trends per geographical group. The mosaic, the instrument used to measure debt trends, concluded that ill-educated South African consumers were battling to pay their debts which led to credit defaults. Many believe that financial education is the answer, and we can see why. If all South Africans received a quality education that served the knowledge of financial management and consumer rights, perhaps defaulting debt would not be as big of a problem as it is. According to Riona Naidu, Experian’s head of marketing, there is a clear distinction between credit activity, namely defaults, and consumers who lack education. “There is a correlation between education and what’s available and how you behave and perform in terms of your credit default. We don’t notice a particular ethnicity or one gender type… so there’s no skew really, except from a population size perspective”, says Naidu.
South Africa’s general debt statistics are rather high, with more and more consumers being plagued by their financial responsibilities month after month. And even though R13.6bn may be a large number, it is a bit of an improvement from the same period of 2016. Experian explains that this is partially due to the tighter credit regulations in the National Credit Act (NCA). A total of 14.7 million consumers have credit cards, as well as various loans, including home, personal and vehicle loans. Of this 14.7 million consumers, a whopping R1.54 trillion is outstanding credit.
If you are one the South African consumers who defaulted your credit payments, feel free to fill out National Debt Advisors (NDA) contact form today, and one of our consultants will gladly give you a call back to discuss your debt management options.