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Debt Index

Q3 2021 Debt Index

30 November 2021

In this quarter, consumers still felt the pinch due to the effects of covid on finances. People have struggled to borrow money and thus have not been able to lessen the strain of financial pressure. A positive that we've found in this quarter is that the number of people completing their debt counselling journeys is increasing.

Gain access to more insights below:

Download the full Q3 2021 Debt Index here.

Based on the results from the report, DebtBusters said this to the public:

Debt Index: More consumers seek help as credit crunch bites

South Africa may, for the moment, be over the worst of the pandemic, but like lingering long Covid, consumers are still feeling the effects of consecutive lockdowns and the full impact of 2020 payment holidays which have now ended.

Add to this a diminished ability to borrow which means getting any relief from the symptoms of straitened finances is harder.

The good news, according to Benay Sager, head of DebtBusters, is that more people are proactively seeking help for their financial ills, with debt counselling enquiries up by 17% compared to Q3 2020.

DebtBusters’ Debt Index for Q3 2021 shows that the situation for consumers struggling with debt is deteriorating.

“With no meaningful increase in real income, consumers continue to turn to unsecured credit to supplement their paycheques. It’s a trend that we’ve seen intensify over the past few years,” says Sager.

The latest Debt Index shows that compared to 2016, consumers who applied for debt counselling during Q3 2021 had:

  • Zero nominal income growth and negative real income growth. Nominal incomes were the same as 2016 levels, but when the cumulative effect of inflation is considered, real income shrank by 24% over the five years.
  • A higher debt-to-net-income ratio. Alarmingly the average ratio of debt to net income is now 116% across all income bands. This is higher than during any comparable period since 2016. For people taking home R20 000 or more it is now 145%. To put this into perspective, people who are consistently spending 60% of their take-home pay to service debt are considered eligible for debt counselling.
  • Levels of unsecured debt that were, on average, 25% higher than 2016 levels. For those people taking home R20 000 or more unsecured debt was 59% higher. This points directly to consumers increasingly using unsecured credit to counter the erosion of net income.

Sager says loan sizes have increased by 50% over the past few years, proving that people need access to more money due to their income not growing. The number of debt obligations have declined by 19% which points to consumers seeking help sooner.

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Other positive news is that the number of people who have successfully completed debt counselling has increased sixfold over the past five years. Consumers who received their clearance certificates in Q3 2021 paid back R300m worth of debt while under debt counselling.

During the quarter 57% of new applicants were men, a sustained increase. Sager says this is a welcome development as South African men used to be reluctant to seek help with their finances, with the majority typically preferring to struggle on alone.

“Not dealing with debt can impact mental health and given November is Men’s Health Awareness Month, it’s good to see a growing understanding of debt counselling, how it works and recognition that it can be an effective way to manage debt.”

Note to editors DebtBusters is South Africa’s leading and largest debt counsellor and holds the 2021 Debt Review industry award for the best national debt counselling company - the sixth time it has won in eight years.

The quarterly debt report is compiled from data provided by clients who have applied for debt counselling. For more information visit

Benay Sager Head of DebtBusters

Benay Sager Head of DebtBusters

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