Types of debt in South Africa


Many types of debt are available to the average consumer, from short and long term to secured and unsecured, all these terms and processes become jumbled after a while. For the average consumer, all this jargon is almost unrecognisable.

As the debt situation in South Africa reaches a dire status, with about 9.85 million South Africans have impaired credit records and the number of individual, impaired accounts being over 20 million. This was revealed in the latest statistics from the National Credit Regulator. With so many in this trap of lending, we decided to shed some light on the typed of debt you can incur in South Africa.

Secured Credit

This is when lenders insist on having assets connected to the agreement, as collateral. This means that the assets can be repossessed in the case of non-payment, to cover the costs of the debt.


The home you are financing secures the credit, this allows you to take out money against your home.

Car loan

The car forms collateral for the loan. If the loan is not repaid, the car will usually be sold off for the remainder of the owed amount.

Home loan

Your home secures the debt. This will also allow for the property or house to be sold off to the value of the remaining debt, in order to settle the account.

Unsecured Credit

This type of debt relies on your written promise, with no secured collateral – promising repayment without putting anything on the line. They accept you will repay the debt as agreed. This often comes with higher rates and shorter repayment plans to ensure the debt is recovered.

Credit cards

When approved, this type of credit asks that you pay in a monthly minimum towards your outstanding balance. More can be paid to reduce interest on your debt, however only the minimum is required.

Retail store and petrol cards

Repayment is usually on a monthly basis and an agreed on minimum must be paid each month into the account. Similar to a credit card, but often with different policies and rates.

For help with debt or to find premium debt solutions in South Africa, give National Debt Advisors a call today, or fill out a contact form and a consultant will phone you right back.

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