Credit drops, but only by a spot

A MARGINAL decrease in credit provided in the past year has done little to hearten the National Credit Regulator (NCR).

According to the latest Consumer Credit Market Report released by the NCR on Thursday, a number of applications for credit decreased by 0.39% quarter-on-quarter from 9.99 million in March this year to 9.95 million in June.

The total value of new credit granted decreased marginally by 0.01% quarter-on-quarter from R108.33-billion to R108.32-billion.

New mortgages granted increased by R2.75-billion (8.30%) quarter-on-quarter, but decreased by R425.76-million (1.17%) year-on-year.

Secured credit, which is dominated by vehicle finance, increased by R1.79-billion (5.25%) quarter-on-quarter but decreased by R427.45-million (1.17%) year-on-year.

But with 86% of South Africans in debt and 10.26-million with accounts three months in arrears, the National Credit Regulator (NCR) CEO Nomsa Motshegare reiterated the regulator’s long repeated warning to consumers to keep their cards in check.

‘It is of concern the continuous deteriorating consumer credit health.

‘I remind consumers to draw up a monthly budget, keep track of expenditure and live within your means as we approach the festive season.

‘Consumers who are already battling with their debt repayments are advised to approach their credit providers to find an alternative arrangement.

‘Alternatively, over-indebted consumers can approach the nearest debt counsellor for assistance.’

Troublesome trends
• The total outstanding consumer credit balances (or gross debtors book) as at June 2016 was R1.66-trillion, representing an increase of 0.31% quarter-on-quarter and 2.35% year-on-year.

• Mortgages debtors book increased by R2.70-billion (0.31%) for the quarter ended June 2016 and by R9.12-billion (1.06%) on a year-on-year basis.

• Secured credit debtors book increased by R4.08-million (1.10%) for the quarter ended June 2016. On a year-on-year basis, the book grew by R17.52-billion (4.91%).

• Credit facilities debtors book decreased by R206.14-million (0.09%) for the quarter ended June 2016, but increased by R7.47-billion (3.53%) on a year-on-year basis.

• Unsecured credit debtors book decreased by R2.44-billion (1.48%) for the quarter ended June 2016, but increased by R49.37-million (0.03%) on a year-on-year basis.

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