2023 one of most difficult for SA consumers
2023 was among the most difficult financial years that South African consumers have endured since democracy.
That's according to Debtbusters.
The debt counselling and consolidation company has released its latest debt index from the fourth quarter.
It shows high inflation and interest rates, a strained economy and load shedding put more financial pressure on consumers.
Debtbusters' Benay Sager said many were pushed into a corner and forced to spend extra cash per month towards their debt.
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"What we find is that consumers have to spend 62% of their take-home pay to service their debt, and one can do that in one or two months, but it’s not something one can do sustainably.
“Anytime anyone is spending more than 30% of their take-home pay more for debt repayment, the situation becomes really difficult for them, and anything above 40% is definitely not sustainable. What we found is that because the income is not growing, consumers are having to supply that lack of growth by borrowing or taking from their credit cards," Sager said.
The Q4 Debt Index shows demand for debt management increased.
Debt counselling inquiries were up by 46% and online debt management was up by 54% compared to the same period last year.
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