/ 29 June 2011

Credit applications decrease since 2010

Consumer credit granted by South African registered credit providers has increased 31.2% from March 2010 to March this year, a National Credit Regulator (NCR) report released on Wednesday revealed.

Unsecured lending experienced a year-on-year rapid growth of 66.8%, the report showed.

The total value of new credit granted decreased from R83.53-billion for the quarter ended December to R80.75-billion for the quarter ended March, the information submitted by credit providers to the regulator revealed.

The number of applications received for credit decreased by 917 558 from 6.72-million in December to 5.8-million in March.

Other findings included that the value of new mortgages granted decreased quarter-on-quarter from R26.87-billion to R24.76-billion; secured credit, which is dominated by vehicle finance, decreased from R28.12-billion to R27.45-billion; credit facilities which mainly consisted of credit cards, store cards and bank overdrafts increased by 1.81% from R10.25-billion to R10.43-billion; short term credit showed a decrease of 2.85% from R1.46-billion to R1.42-billion.

The banks’ share of the total outstanding consumer credit as at March was R1.09-trillion, with retailers at R36.25-billion, non-bank vehicle financiers at R40.15-billion, and other credit providers at R43.71-billion.

South African credit bureaus reported records for 18.6-million credit-active consumers, an increase of 0.5% over the 18.5-million of the previous quarter.

Consumers classified in good standing increased by 0.1% to 9.97-million.

The number of credit accounts decreased from 64.28-million in the previous quarter to 63.05-million, while the number of impaired accounts decreased by 107 000 to 16.26-million, from 16.36-million in the previous quarter.

Reporting bureaus attributed this to both market trends and data management exercises undertaken in this quarter. — I-Net Bridge