Getting Private Credit
The demand for credit is making a recovery in the light of improvement in the economic sector with a combination of low interest rates and low inflation. The recovery is slower than anticipated but at least there is a demand once again.
In 2010, credit demand from SA’s private lending sector grew by only 2% but is steadily rising.
Economists reckon that December’s data shows that the demand for credit is still driven by private households. Business has not increased their demand for debt as yet, according to economist Kgotso Radira from Investec. It is believed that businesses are waiting for the economy to stabilize before taking on more debt.
Banks in general are careful when it comes to giving loans, due to the recent debacle of the credit crisis that had so many banks in hot water.
The main players in credit extensions in 2010 were mortgages and bonds, as well as further loans and advances to private individuals.
In December of 2010 mortgages were a lot lower which illustrates the difficult conditions in the local property market.
In December credit cards as well as other loans and overdrafts increased by at least 5.7%, making this the fifth month of growth.
You are on the right page if you would like to find out more about credit or any other issues regarding finance. Simply contact us should you wish to know more about money tips.
