Donwald Pressly reports on Business Report:
“Consumers are acting in a more discerning manner as a result of increases in the cost of living, “despite excessive and sometimes reckless marketing … in the run-up to the implementation of the National Credit Act”, according to the National Credit Regulator’s latest annual report, published last week.

Chief executive Gabriel Davel said feedback from credit providers indicated more discerning behaviour at all income levels. The National Credit Act came into effect in June last year.

Davel said the next 12 to 18 months would nevertheless be challenging for consumers and credit providers. The cost of living had increased dramatically, “with food, fuel and electricity prices increases all making a contribution”.

Increases in interest rates implied significantly higher debt servicing costs. “Increased debt stress is notable and further increases are inevitable over the coming months,” he predicted. “This poses a huge challenge to all the parties involved in consumer credit.”

Davel said 2 535 credit providers had been registered in the past year, representing 27 000 branches. The largest proportion comprised 11 110 branches of banks, or 41 percent of provider branches. The second-biggest category was microlenders with 5 500 branches, or 21 percent. There were 4 291 clothing retailer branches (16 percent) and 2 772 furniture store branches (10 percent).

He said 336 debt counsellors had been registered and had undergone training.”

 Read the Full Article