Are South Africans sinking deeper into a debt trap?
The answer will be yes if the latest figures of the National Credit Regulator (NCR) are anything to go by.
Even NCR CEO Nomsa Motshegare seemed to be raising the alarm at the site of these figures which show a further increase in the levels of impairment during the quarter ended June.
The NCR figures showed that credit bureaus held records for 20.08 million credit-active consumers in the quarter, an increase of 0.6% when compared to the 19.97 million of the previous quarter. Consumers classified in good standing decreased by 76,000, to 10.55 million consumers. As a percentage of the total number of credit-active consumers at 52.5%, this reflects a decrease of 0.7% quarter-on-quarter and 1.1% year-on-year.
The number of consumers with impaired records increased by 189,000 to 9.53 million, from 9.34 million in the previous quarter. As a percentage of the total number of credit-active consumers at 47.5%, this reflects an increase of 0.7% quarter-on-quarter and 1.1% year-on-year %.
Motshegare said the statistics indicate a concerning increase in the levels of impairment. She encouraged consumers to monitor their credit health and to approach their credit providers and debt counsellors for assistance.
The figures also showed that the number of accounts increased from 69.53 million in the previous quarter to 70.73 million. The number of impaired accounts increased from 17.52 million to 18.31 million when compared to the previous quarter, an increase of 790,000 quarter-on-quarter and 1.37 million year-on-year.
A total of 394.47 million enquiries were made on consumer credit records, an increase of 16.3% quarter-on-quarter and 27.1% year-on-year. Enquiries initiated by consumers accounted for 15.26 million of all enquiries, a decrease of 11.2% quarter-on-quarter and an increase of 13.9% year-on-year. Of the total enquiries made on consumer records, enquiries from banks and other financial institutions accounted for 83.3%, enquiries from retailers accounted for 3.8% and enquiries from telecommunication providers accounted for 5.1%. Banks and other financial institutions’ enquiries increased by 15.2% from the previous quarter, retailers increased by 20.5% and telecommunication providers decreased by 10.7%.
The number of credit reports issued to consumers decreased to 145,720. Of the total credit reports issued, 83.5% (121,659) were issued without charge, and the remaining 16.5% (24,061) were issued with charge.
There were 16,868 disputes lodged on information held on consumer credit records for the quarter ended March 2013, an increase of 3.1% quarter-on-quarter and 62.9% year-on-year.