Middle income earners make up the majority of all Debt Counselling clients in South Africa currently.
According to Paul Slot, president of the Debt Counselling Association Of SA (DCASA), consumers earning between R5 000 and R20 000 per month make up 74% of all clients who have applied for Debt review.
Slot believes the number of clients applying for debt counseling will continue to increase as most ‘have already borrowed too much and this mean too much of their income is committed to debt repayments.
Unless consumers are able to increase their monthly incomes in the near future, or somehow reduce their living costs it is expected the petrol price hikes, food price increases and future interest rate hikes will have an very large impact on most household budgets.
Although there are less than 800 registered debt counsellors currently active in South Africa, the DCSA believe that there is no shortage of help available to highly indebted clients.
“We do not believe that there is a shortage of DCs [debt counselors] and many DCs are under utilised at present. Currently about 6,000 consumers enter the process and existing DCs can handle this capacity,” he said.
One factor that assisted in this process, Slot said, was the NCR Task Team agreement where standard process and forms were agreed to.