If you’re thinking about taking out a loan, first consider:
- There are currently 19 million consumers with impaired credit records – the highest number in South Africa ever. Being credit impaired means you have fallen into arrears for 3 months or longer on at least one loan.
- Over 11 million consumers are over-indebted. Which means their monthly debt repayments and living costs combined exceed the income they earn monthly.
- +/-10,000 homes are repossessed a year to recover debts and some borrowers were even jailed. This rate of eviction can only be compared to the inhumane Group Areas Act removals of Apartheid.
- The average household debt-to-disposable income ratio exceeds 78%. Which means that, on average, almost 80% of the monthly take-home pay that households earn goes towards loan debts.
- At 15.5% (below a 6th of our GDP) South Africa has one of the worst savings rates in the world.
- 86% of SA consumers took out a loan in 2014, making us the biggest borrowers in the world.
Still interested in applying for a loan?
You cannot deny how dangerous taking out even one is, in the face of these compelling statistics.
Taking out just one comes with the risk of having to take out another loan to cover the repayments later on. This is exactly how predatory lenders ensnare borrowers in an inescapable debt trap. Out of greed, reckless lenders prey on uneducated, desperate and vulnerable consumers, who don’t know any better.
What are we actually working for?
Are we working to look after ourselves and our families, and to meet our basic needs? Or are we just working to pay off loan debts?
Here’s to knowing better than to take out a loan! One reckless loan today can result in poverty and over-indebtedness another. Rather contact NDA now, if you need financial help. We can help you become debt free instead – a much smarter, better plan.
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