High interest rates in South Africa have put a significant strain on car owners with car loans over the past year, leading to a rise in delinquencies.
Data from WesBank, the largest vehicle and asset finance institution, indicates a 3.5% increase in the average loan amount for new vehicles in June. In May 2024, the South African Reserve Bank’s Monetary Policy Committee decided to keep interest rates unchanged. The latest report from TransUnion’s Vehicle Price Index for Q4 2021 indicates that the average value of a financed vehicle is approximately R360,000.
vehicle asset finance delinquency rate of 5.4%—measured as a percentage of accounts three or more months in arrears.“Layer in the other inflationary costs of living to that consumer, and you can imagine the pressure on household budgets,” added Gaoaketse. Passenger cars declined 9% to 26,928 units, while Light Commercial Vehicles were down 24,3% at 10,552 vehicles.