Growth in household credit and mortgage balances slows down further

The total value of outstanding credit balances in the South African household sector came to R1 391,6 billion at the end of August 2014, which was R2,9 billion down on total credit balances of R1 394,5 billion at end-July. This was mainly the result of lower unsecured credit balances up to August, while mortgage balances were also down from July, which could be related to rising financial strain experienced by the household sector against the background of inflationary pressures, declining real income growth and higher interest rates. Household credit balances, showing growth of 3,6% year-on-year (y/y) at end-August, which was the lowest growth since March 2010, comprise of instalment sales, leasing finance, mortgage loans, overdrafts, credit card debt, and general loans and advances (mainly personal loans and micro finance) ABSA Credit and mortgage advances (Aug 2014)