Q2 2024 Report highlights include:
- Younger borrowers continued to drive credit activity growth during Q2 2024
- Personal loans remained in high demand, accounting for 77% of total credit openings during the quarter
- New home loan volumes continued to rise, with growth concentrated among below prime borrowers, despite affordability concerns
The number of overall credit originations (a measure of new accounts opened) increased by 15.2%, as South Africans increasingly used new and existing credit products to meet their rising consumption needs via credit cards, personal loans, and retail revolving loans.
Overall, the number of credit active consumers grew by 4.7% YoY to 18.5 million people, of which 28.1% hold credit cards, demonstrating that more South Africans have access to financial products and services to facilitate lifestyle essentials. Originations for consumption-led products i.e. facilities to pay for day-to-day expenses, accounted for 83% of all new credit opened, growing by 16.8% YoY in Q2 2024. The country’s credit market stood at an outstanding balance of R2.37 trillion, up 3.7% YoY, with total balances within consumption-led products up 5.1% YoY.
Q2 2024 Metrics for Consumer Credit Products
1Account-level serious delinquency rate, measured as a percentage of accounts three or more months in arrears
2Inclusive of both bank issued, and non-bank issued personal loans
“Growth in new credit products issued and use of existing credit is typically driven by economic requirements as consumers take on credit to boost their available income during challenging economic times. However, there is hope on the horizon as inflation decreased during the quarter, with annual food price inflation at its lowest since late 2020*. Consumers are likely to see further respite in the coming months, along with the anticipation of a reduction in interest rates, with this combination likely to provide relief to stretched household budgets.”
- Lee Naik, CEO of TransUnion Africa
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).Businesses can access more details about and subscribe to the Industry Insights Report. The South Africa Industry Insights Report looks at major consumer lending categories: credit cards, personal loans, home loans, vehicle and asset finance (VAF), and clothing. The report primarily focuses 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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