Instalment credit, personal loans most popular in January

INSTALMENT credit loans are the most popular loans taken up during January, followed by personal loans.

Also, there has been a consistent trend in instalment credit loans and personal loans between December and February (“this time of the year”) in the last five years.

This information was provided to The Namibian by Compuscan Credit Bureau upon request this week.

Compuscan is one of the fastest-growing full-service credit bureaux in South Africa and Namibia, servicing an extensive client base which includes banks, telcos, retailers, microlending institutions, insurance companies, debt counsellors and debt collectors.

Corné van Niekerk, country manager at Compuscan Namibia said the data is supplied by large Namibian credit suppliers such as First National Bank, Edcon and Truworths, Furnmart and RCS, among other credit suppliers.

This database includes 674 579 loans, belonging to 339 234 unique ID numbers, which means that there are an average of two loans per unique individual.

“We observed a large spike in loans taken up by Namibians, specifically during December, followed by a drop in January,” he said.

Compuscan further observed that Namibian consumers are taking out more microloans each year, an increasing trend over the past five years (2012-2016).

“Between December and February, we observed a spike in microloans taken up by Namibians, specifically during the month of January,” added Van Niekerk.

Compuscan’s data analysis further noted 2 024 768 microloans, belonging to 140 869 unique ID numbers, listed on the Compuscan Namibia microlending database, he further revealed, adding that “our data analysis revealed an average of 14 microloans per unique ID”.

“Note the difference in trends between the two databases (microloans vs secured lending) – which indicates that the microlending sector is growing, whilst the CPA (secured lending) space remained stable over the past five years,” he commented.

Van Niekerk further advised Namibians who may have overspent during the festive season not to stick their heads in the sand.

“If you find yourself over-indebted or struggling to make ends meet, you need to evaluate your situation and set up a plan as soon as possible,” he urged.

This month, finance minister Calle Schlettwein appealed to Namibians not to borrow beyond their ability to repay their loans.

However, the minister explained that borrowing in itself is not a bad thing if it is used as financing for productive purposes.

Schlettwein thus asked Namibians to start differentiating between borrowing for consumption, and borrowing for productive purposes.

In an age of information overload, Sunrise is The Namibian’s morning briefing, delivered at 6h00 from Monday to Friday. It offers a curated rundown of the most important stories from the past 24 hours – occasionally with a light, witty touch. It’s an essential way to stay informed. Subscribe and join our newsletter community.