Neil Roets, the chief executive of Debt Rescue, has noticed a troubling trend: more and more South Africans are seeking help with their debt. “With little relief in sight when it comes to living costs, this is likely to intensify as the year unfolds,” he says.
Sky-High Interest Rates
Roets said that one of the biggest issues driving the cost-of-living crisis is the “astronomical interest rates” people are paying on home and car loans and other major debts. Monthly home loan repayments are now at least 40% higher than they were three years ago, forcing many to cut back on essentials like food and healthcare.
Costly Credit Cards
He also points out that despite these high interest rates, many South Africans still rely heavily on credit cards. “Average interest rates for unsecured credit, including credit cards, are hovering around 25.7%. This is some of the highest we’ve seen since 2016. So that’s pretty expensive credit, especially if you’re unsure whether you’ll make the necessary payment by day 55,” Roets explains.
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