'Januworry' credit demand soars
South African consumers are
trying to cut back on costs where possible this 'Januworry', but experts say
the harsh reality is most people are still turning to credit to put food on the
table.
According to the recent survey by Debt Rescue, about 64% of consumers have entered the new year with no savings to fall back on.
This despite 38% of households making saving money every month a priority on their New Year resolutions' list.
Debt Rescue's Annaline van der Poel says while festive season spending does play a role, South Africans took care not to over-spend during this period.
READ: Spend wisely during holidays to avoid debt - expert
But she says the biggest financial hurdle is the impact inflation had on year-end spending.
"Even though we have started seeing reduction in interest rate, the reality is it went up very quickly a lot faster than it is coming down. It was such extensive period that consumers will stretch for a long period of time, and if you have look at your budget you look at the one-side inflation which affect the cost of living.
"On the other hand, your debt repayment which were affected by interest, realistically there is very little that has so far unfortunately had enough of a contribution to get really get consumers out of it."
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