The CEO of the national credit regulator, Nomsa Motshegare, has encouraged consumers to use credit responsibly and to live within their means.
She was responding after the NCR released the Consumer Credit Market Report (CCMR) and the Credit Bureau Monitor (CBM), based on the data submitted to the NCR by registered credit providers and credit bureaus.
This latest edition of the report covers credit market information up to March 2014.
Motshegare said the statistics reported for the quarter that ended March 2014 indicated a seasonal decline in the value of new credit extended to consumers.
The total value of new credit granted decreased by R13.06bn (11.01%) from R118.66bn for the quarter that ended December 2013 to R105.60bn for the quarter that ended March 2014.
There was an overall quarter-on-quarter decline for all credit types with the exception of “developmental” credit.
The number of applications received for credit decreased by more than a million from 10.75 million in December 2013 to 9.67 million in March 2014, a decrease of 10.02% quarter-on-quarter and a decrease of 4.41% year-on-year.
The following were some of the most significant trends observed in terms of credit granted:
* The value of new mortgages granted decreased by 11.17% quarter-on-quarter from R34.72bn to R30.84bn.
* Secured credit, which is dominated by vehicle finance, decreased from R40.58bn for December 2013 to R35.35bn for March 2014, a quarter-on-quarter decrease of 12.88%.
* Credit facilities, consisting mainly of credit cards, store cards and bank overdrafts, had a decrease of 13.26% quarter-on-quarter from R18.70bn to R16.22bn.
* Unsecured credit decreased from R21.61bn for December 2013 to R18.82bn for March 2014, a quarter-on-quarter decrease of 12.92%.
* Short-term credit decreased from R1.38bn for the quarter ended December 2013 to R1.23bn for the quarter ended March 2014, a decrease of 10.83%.
* Developmental credit had a quarter-on-quarter increase of 87.53% from R 1.68bn to R 3.14bn.
As at March 2014, the total outstanding consumer credit balances (or gross debtors’ book) was R1.55trn, representing a quarter-on-quarter growth of 2.04% and a year-on-year growth of 6.87%.
The trends for outstanding balances for the quarter ended March 2014 were as follows:
* Mortgages debtor’s book increased from R818.06bn for the quarter ended December 2013 to R823.33bn for the quarter ended March 2014, an increase of 0.64%.
* Secured debtor’s book, which is dominated by vehicle finance, increased from R323.11bn for December 2013 to R331.72bn for March 2014, a quarter-on-quarter increase of 2.66%.
* Credit facilities debtor’s book, which consists mainly of credit cards, store cards and bank overdrafts, had a quarter-on-quarter increase of 3.04% from R185.37bn to R190.57bn.
* Unsecured credit debtor’s book increased from R170.75bn for December 2013 to R172.97bn for March 2014, a quarter-on-quarter increase of 1.30%.
* Short-term credit debtor’s book decreased from R791.29m for the quarter ended December 2013 to R707.343m for the quarter ended March 2014, a decrease of 10.61%.
* Developmental credit debtor’s book increased from R21.95bn for the quarter ended December 2013 to R31.67bn for the quarter ended March 2014, an increase of 44.27%.
The banks’ share of the total outstanding consumer credit as at March 2014 was R1.31trn (84.76%), retailers was R35.17bn (2.27%), non-bank vehicle financiers at R56.71bn (3.66%), and “other credit providers” at R144.44bn (9.71%). Other credit providers consist primarily of pension-backed lenders, insurers, non-bank mortgage lenders and securitised debt.
Credit bureaus held records for 21.71 million credit-active consumers, an increase of 5.2% when compared to the 20.64 million in the previous quarter.
( Courtesy Fin 24 & AGENCIES …….. Source …….. Our Freelance Contributor in Cape Town)