This is expensive debt and the high interest on it is hampering consumers, says Benay Sager, the head of debt counsellor DebtBusters.
He says that the unsecured debt of people who take home more than R20 000 a month is now 50% higher than it was six years ago.This is because people take on debt to try to make up for the effects of inflation on their income. DebtBusters, the debt counsellor with the most debt under management in South Africa, says its debt index for the third quarter shows total debt levels are now on average 21% higher than in 2016.
Payments of R62 out of every R100 in debt service costs are unsustainable unless there are interventions such as debt counselling, he says. According to TransUnion, 64% of consumers expect they will be able to pay their current bills and loans in full regardless of tough economic times. This shows that consumers prioritise their credit obligations.
In the third quarter of this year, six times more consumers successfully completed the debt counselling process compared with the corresponding quarter in 2016. They repaid more than R430 million to their creditors in the third quarter.According to Sager, about 45% to 50% of people who obtain debt counselling are successful in paying off their debt, compared with only about 18% of those in debt about six years ago.
No link to the survey or the data, no definition as to who is covered, no sample size or any indication of the data source. This is gibberish dressed up as a serious report. Shocking journalism. No biscuit.
True...