Q1 2025 Industry Insights
South Africa’s Consumer Credit Market Sees Targeted Growth in Key Products, Despite New High in Personal Loans Delinquencies
Q1 2025 Report highlights include:
- Credit card originations rose by 30.7% as demand grew, with below prime originations up by one third year-over-year (YoY)
- Vehicle finance originations grew significantly YoY, indicating growing momentum in the automotive industry
- Non-bank personal loans saw highest delinquency rate since previous high point in Q2 2021
The growth in originations of new credit cards, at 30.7% year-over-year (YoY, far outstripped growth for other consumer credit products during the first quarter of the year. Strong growth in credit cards was driven, in part, by lenders extending cards to more below prime1 borrowers than they did one year ago – up 33.1% YoY.
The vehicle loans market continued to show encouraging signs of continued growth, as origination volumes increased by 11.6% YoY in Q1 2025. The average value of new loans also rose by 3.0% over the same period.
Q1 2025 Metrics for Consumer Credit Products
"South Africans are increasingly turning to low-value personal loans with shorter repayment terms to manage their monthly expenses. However, persistently high delinquency rates — particularly among non-bank personal loans — indicate that many consumers are under significant financial pressure and struggling to meet their loan commitments. As lenders respond to growing demand for this type of credit, it’s essential they align their growth strategies with prudent risk management to ensure long-term sustainability."
Ayesha Hatea, director of research and consulting at TransUnion
About the South Africa Industry Insights Report
TransUnion’s quarterly South Africa Industry Insights Report provides in-depth, statistical information drawn from its national consumer credit database, aggregated across virtually every active credit file on record. Each file contains hundreds of credit variables that illustrate consumer credit usage and performance. Entities across industries can subscribe to and leverage the Industry Insights Report to analyse market dynamics throughout an entire business cycle, helping them understand consumer behaviour over time.
The report looks at major consumer lending categories: credit cards, personal loans, home loans, vehicle and asset finance (VAF), and clothing, focusing primarily on three dimensions across these categories: originations (new accounts opened), balances (outstanding total and average lending balances) and delinquencies (accounts in payment arrears).
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