Africa-Press – South-Africa. IN A bid to highlight the danger of overspending, and rising debt, Nedbank held a live street exhibition in Sandton Drive.
In a statement, Nedbank said the objective of the exhibition was to showcase how making good money management choices was an effective way of addressing these issues and securing a better financial future.
Nedbank group executive for marketing and corporate affairs Khensani Nobanda said: “While the government is working to get the country back on a positive economic growth path, most South Africans have reached a crossroad in their financial lives.
“And consumers must take an honest look at how they manage their money and how the money choices they make affect them and their families,” she said.
According to the bank, through the exhibition, it wanted to draw attention to the reality of overspending and irresponsible borrowing, as well as the urgent need to save and invest for the long term.
The bank said financial experts will be available as the campaign unfolds to help people understand the impact of their money choices, good and bad – and to offer alternatives to old spending patterns.
“An excessive reliance on credit was demonstrated by the TransUnion Q4 2020 South Africa Industry Insights Report, which found that South Africans currently have 7 million credit cards, 16,2 million clothing accounts, 2,3 million vehicle accounts, 6,7 million personal loan bank accounts, and 5,7 million personal loan non-bank accounts,” it said.
According to the bank, over-indebtedness is not limited to low- or middle-income households. Experian’s Q4 Consumer Default Index reported that new default balances in Q4 2020 amounted to R18,26 billion, with the bulk of this being among the most affluent segments of the population.
“Wealthy households have an outstanding debt of almost R600bn, and the top 2,5% of South Africa’s credit active population was responsible for total new defaults on debt repayments of more than R4bn. Up to 40% of consumers skipped retail store payments, and nearly 60% skipped personal loan payments,” the bank said.
Simultaneously, the household saving rate in South Africa decreased to 0,50% in Q4 of 2020 from 0,70% in Q3 of 2020, it added.
Nobanda said while there was nothing inherently wrong with debt and consumption – they are drivers of growth to South Africans – consumers need to address some of the ingrained money habits and attitudes within the culture that are hindering them to achieve long-term wealth creation.
“Rampant consumerism at a large scale is unsustainable. As the bank that takes money seriously, we support South Africans in improving their financial positions and helping to rebuild commerce, and the broader economy, in South Africa sustainably,” she said.
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