financial crunch

South Africa: Consumer debt distress sends alarm bells ringing for banks

By Xolisa Phillip, in Johannesburg

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Posted on April 25, 2023 13:15

The logo of South Africa’s central reserve bank is seen during the delivery of a keynote address by South Africa’s central bank governor, Lesetja Kganyago, at the University of the Witwatersrand in Johannesburg, South Africa, November 1, 2022. REUTERS

South African consumers’ credit balances are anything but reassuring amid elevated interest rates, making asset-backed financing riskier as more consumers are falling deeper into a debt trap, according to experts.

The Africa Report spoke to Weihan Sun, the director of research and consulting at TransUnion Africa, and Kriben Reddy, vice president of TransUnion’s consumer credit bureau. Both experts have voiced concerns over changes to debtors’ behaviour.

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