Well the truth is that the problems with unsecured lending is simply that when high-interest loans are not backed by collateral and end up being 12% of South African banks’ credit exposure as of the end of January 2014 these simply just show our poor economic issues at stake but this will not spread to other banks.  the signs have been around for a while.

What this shows us is that people cannot pay all there loans because their income is dropping and their expenses are going up together with high unemployment, low growth and high inflation – it puts pressure on everyone.

South African household debt averages about 75% of disposable income, meaning servicing debt is a huge burden for low-income households, where food costs alone account for a third of expenditure.  STANDS to REASON why debts are not being paid.

The central bank bailout is very good news for taxpayers and customers alike.  Thanks folks!

So as far as personal loans stand – do not become a client that moves from “medium to high risk”.

 

Stay smart and secure!