- Credit extension grew slower by 0.51%
- Credit card spending rose by R 259 000
- Cash credit advances are down
The credit crunch and the previously prevailing high interest rate environment have caused less credit to be available. The latest figures show that as consumers are feeling the pinch they are turning to credit in order to meet their obligations, as less of this credit is extended, credit cards are being used more frequently to offset what may have been before covered by a short term loan. Credit extension however is still growing at 4.34%.
In a recession it can be very dangerous to rely on credit to meet your obligations and could land you in a credit trap. If you are struggling firstly plan your budget then cut back what you can and as a last resort look to a credit instrument to tide you over. Credit cards if managed properly can be very cheap to use but require that you pay them back in full promptly every month, if not you pay interest and will find it harder and harder to pay that debt.