How much debt do you have?

With the likelihood of a massive petrol price hike in April, how much longer can South Africans keep stretching their budgets before reaching breaking point?

Earlier this month, the SA Human Rights Commission (SAHRC) noted that, of 19 million credit-active consumers in South Africa, 50% had impaired credit records three months or more in arrears.

According to the National Credit Regulator (NCR), credit bureaus hold the records for approximately 22 million credit-active consumers.

Consumers classified in good standing stood at just more than 12 million consumers in 2014, with the number of consumers with impaired records at around 10 million.

The number of accounts were at around 80 million, while the number of impaired accounts stood at about 21 million.

Neil Roets, CEO of debt management company Debt Rescue says that based on client information, the biggest number of accounts are unsecured debt.

Unsecured debt is a loan not backed by an underlying asset, like your house or car. It includes credit card debt, medical bills, utility bills and any other type of loan or credit that was extended without a collateral requirement.

“We are seeing a continued increase in pay-day loans – loans that have to be repaid in full at the end of the same month as being taken – as well as short to medium-term personal loans from all the major credit providers, Roets said.

He said that the average applicant for debt rescue has 14 unsecured accounts, one vehicle, and one property.

The average age of an applicant is ‘early forties’ with the bulk between 35 and 45. Gender shows a fairly equal split.

The average total debt exposure is as follows:

Clients with mortgages : R950 000
Clients without mortgages : R240 000
SA credit bureau, Compuscan published its own data in March relating to consumers’ credit behaviour in Q4 2014.

It found that at the end of Q3 2014 there were 2,015,276 accounts listed as handed over, assets repossessed, account written off or facilities/credit card revoked.

There are now 3,139,687 such accounts, which means that there was a 56% increase in adverse account listings in one quarter, it said.

Additional findings from Compuscan on the credit behaviour of SA consumers:

Vehicle and asset finance for Q4 2014

Less than or up to  R5000

3%

R50 001 – R100 000

11%

R100 001 – R250 000

51%

R250 001 – R400 000

21%

R400 001 – R999 999

14%

R1 million+

1%

Total no. of VAF loans in retention on the bureau

2 314 462

 

Credit cards for Q4 2014

Less than or up to  R5000

21%

R50 001 – R100 000

28%

R100 001 – R250 000

16%

R250 001 – R400 000

16%

R400 001 – R999 999

19%

Total no. of credit cards in retention on the bureau

6 094 966

 

Store cards for Q4 2014

Less than or up to  R5000

57%

R50 001 – R100 000

36%

R100 001 – R250 000

6%

R250 001 – R400 000

1%

R400 001 – R999 999

0%

Total no. of store cards in retention on the bureau

16 494 066

 

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