The total value of outstanding credit balances in the South African household sector increased by 3,7% year-on-year (y/y) to R1 395,3 billion at the end of September 2014. This was R3,7 billion up on the value of outstanding balances at end-August, when year-on-year growth was 3,6%. Growth in household secured credit balances slowed down further on the back of lower growth in mortgage balances, whereas growth in household unsecured credit balances improved from its recent low at the end of August.
Various factors continue to impact the domestic economy, leading to a forecast of relatively subdued real economic growth this year, with some improvement in growth in 2015. The household sector is expected to continue to experience a fair amount of financial strain as interest rates are forecast to rise further during the course of next year. In view of these expectations, growth in household credit, including mortgage advances, is forecast to remain well in single digits in the remainder of the year and in 2015.