South African households aren’t managing to keep their heads above water, let alone going back to the habit of repaying their creditors as their incomes have been reduced to a fraction of what they used to be.
When the Covid-19 pandemic hit our shores, South African households who had been dealing with shrinking net take-home pay for some time turned to unsecured debt to try to supplement whatever they were still fortunate enough to earn – as many people took pay cuts or lost their jobs, said debt counselling firm, DebtBusters on Thursday.
DebtBusters released its Q4 2020 Debt Index, which showed that in 2020, households’ reliance on unsecured debt surged in 2020. The company said there was a noticeable increase in households’ overall debt levels towards the end of the year. And then, in January 2021, debt-counselling enquiries that the firm received rose to 40% above what DebtBusters recorded in January 2020.
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