FEBRUARY 2018 ANALYSIS INTO THE IMPACT OF

Transcript:FEBRUARY 2018 ANALYSIS INTO THE IMPACT OF:
FEBRUARY 2018 ANALYSIS INTO THE IMPACT OF IMPLEMENTED AND PROPOSED POLICY INTERVENTIONS AGENDA 2 CREDIT MARKET OVERVIEW INTRODUCTION TO RESEARCH AND METHODOLOGY BORROWERS ELIGIBLE FOR DEBT INTERVENTION South Africa is unique in that the NCR publishes data for the entire consumer credit sector. This data includes data on the gross debtors book, arrears levels, new loans granted and active borrowers 3 GROSS DEBTORS BOOK: 2017 Q3 R BILLIONS CREDIT FACILITIES MORTGAGES UNSECURED CREDIT SECURED CREDIT SHORT-TERM CREDIT 895 398 224 166 3 ACCOUNTS (000’S) 5 278 1 730 3 640 25 403 953 Source: NCR Consumer credit report. Developmental credit is provided by lenders registered as developmental credit providers and includes educational loans; small business loans; loans for the acquisition, rehabilitation, building or expansion of low income housing 42 DEVELOPMENTAL CREDIT 1 167 % 90 days or more in arrears 3% 14% 14% 18% 3% 12% 3% 17% 4% 9% 4% 13% 91 DAYS + OTHER There has been a significant increase in access to credit in South Africa. According to the NCR, the number of credit active consumers increased from 17.1 million in the first quarter of 2008 to 25.1 million in the third quarter of 2017. What exactly does it mean to be credit active? CREDIT ACTIVE CONSUMERS 2008 Q1 2017 Q3 17.1 MILLION 25.1 MILLION Total population 18+: 29.9 million 57% credit active Total population 18+: 37.5 million 67% credit active Source: NCR, Stats SA LFS 2008 Q1, 2017 Q3 According to the NCR less than half of those who are credit active are current on all their accounts. What exactly does it mean to be in arrears? CREDIT ACTIVE CONSUMERS 2008 Q1 2017 Q3 17.1 MILLION 7.9 M 45% 2.6 M 15% 2.8 M 16% 2.1 M 12% 2.2 M 13% 12.4 M 49% 2.9 M 11% 5.6 M 22% 2.9 M 11% 1.5 M 6% CURRENT 1 - 2 MONTHS ARREARS 3+ MONTHS ARREARS ADVERSE LISTINGS JUDGEMENTS AND ADMIN ORDERS 25.1 MILLION The NCR also publishes data on new loans granted by income. There has been a noticeable shift in unsecured lending patterns – although we need to remember that income bands are fixed in nominal terms CREDIT FACILITIES GRANTED (Number of loans, millions) UNSECURED AND SHORT TERM CREDIT GRANTED (Number of loans, millions) R7,500 or less R7,501 – R15,000 R15,001+ Source: NCR Consumer credit market report Taking inflation into account, in today’s Rands, the