If you have an African Bank personal loan or other loan from African bank, well the main features of the Reserve Bank’s curator-ship announcement was that the “good” African Bank lending book of R26bn would be recapitalized by R10bn through a consortium of the major banks.
The “bad” African Bank book of R17bn would be bought by the Reserve Bank for R7bn with collection on the bad book set to continue.
So this means YES you must pay your debt folks – it is business as usual. Do not fall behind as there is no excuse and getting a bad credit record over this – is a NO NO!
The good book will continue its lending business as usual – so if you are in need of finance, think carefully first, then see if you can afford it and do not be afraid – the bank is secure, and so is your loan.
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!