Limited Comfort from Petrol Price Cut
According to Neil Roets, CEO of Debt Rescue, South Africans can be forgiven for not jumping for joy at the news of a humble petrol price cut. Roets stated, “The reality is that it is cold comfort for motorists and commuters who have been hit very hard with four consecutive hikes in petrol earlier this year, along with soaring electricity prices and food prices that have escalated out of proportion to salaries.”
The ‘New Normal’ for Consumers
He further explained, “Sadly, this is the ‘new normal’ for South African consumers, definitely for the foreseeable future. There is no doubt that one of the main drivers is the astronomical interest rate people are paying on home and car loans and other big debt, with monthly home loan repayments currently at least 40% higher than three years ago. This necessitates a diversion of spend from necessities like food and healthcare. Will the normalisation of hunger be next in line?”
Decline in Spending Power
Roets added that South Africans were burning through credit to make ends meet. He said, “There has been a sharp decline in the spending power of South Africans across the board with people buying less food than before, while one in four families go hungry in the country. The combination of factors driving this, aside from the decline in consumer buying power, are elevated inflation and reprioritisation of spending amid elevated interest rates, as citizens struggle to survive while contending with the highest interest rate the country has seen in over a decade, fuelled by soaring inflation.”
Read the full article here
Are you struggling with debt while earning an income? If so, let our expert debt counsellors provide a no-obligation, cost-free assessment to consolidate and reduce your monthly repayments for immediate financial relief.
Contact us to speak with our expert counsellors and start your journey toward financial freedom.
