RECENT FUEL INCREASE AND REPO RATE HIKE: A REAL STING TO ORDINARY SOUTH AFRICANS.

By Ithala SOC Limited / 01/03/2023

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Home loan is the most important debt one cannot ignore as an ordinary South African simply because shelter is considered a basic need. With the economic downturn and load-shedding, things are far from being better.

South African consumers are now in more hot waters with the recent Repo rate increase by 25 basis points. This recent increase came after the 1st increase that was announced on the 22nd of September 2022. The predictions by the trends in markets were already showing that there might be another increase in early January; with January being over, we thought we escaped an exe.

The recent increase means that homeowners who are paying R6000 on their bond will now roughly pay R300 extra. One needs to have a winning recipe in terms of how one can avoid defaulting on their home loan payment. Several credit providers have noticed an increase in the number of clients struggling to pay off their debts, home loans, and vehicle finance as the cost of living rises considerably.

A lot of consumers will feel the pinch this year and going forward. Ithala SOC Limited CEO, Dr. Thulani Vilakazi is here to give you some tips on how to stay afloat and not default on your home loan and vehicle finance:

  • Preparing a monthly budget and monitoring actual spending against the budget is always a good discipline that helps you to manage your expenses within your income.
  • Reduce spending a lot of money on luxury items like Pay TV, Wi-Fi, and other subscriptions that take your money. Every cent count’s, and that should go to your bond.
  • In good months, try to add a thousand rand extra to your bond, that will help you finish your bond earlier than expected.
  • In case things get bad and you can’t afford to pay anymore. Kindly make an arrangement with your service provider rather than ignoring calls and having judgments under your name. Explains Dr. Vilakazi.

The repo rate not being the only thing high, the fuel price also went up and as well food prices. Consumers need to manage the expenses that are within their control to ensure that they can still meet other financial commitments.

“As Ithala, our major concern is the lack of financial literacy amongst youngsters, which later in life leads to poor decision-making when it comes to finances. Young people need to be equipped with all the financial knowledge and know how to deal with difficult financial situations and adjust to those situations.’ Concludes Dr. Vilakazi.

A distribution network of 36 Ithala branches in KZN provides convenient transacting facilities.

For more information, visit www.myithala.co.za, call 031 366 2500 or follow #MoveToIthala #RedefiningWealth #StateBank #MyIthala

 

Ends

 

Issued by:      Ithala SOC Limited Head Office

303 Dr Pixley KaSeme (West Street)

15th Floor Delta Towers

Durban

 

 

 

 

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Ithala SOC Limited, licensed financial services and registered credit provider, is a 100% owned subsidiary of Ithala Development Finance Corporation Limited, and is listed as a public entity in terms of Schedule 3 of the PFMA. In line with a recommendation from the South African Reserve Bank, Ithala SOC Limited was divided from Ithala Development Finance Corporation Limited in 2001 and has been operating under an exemption from the Banks Act 94 of 1990 (‘Banks Act’). The current exemption status is a temporary mechanism to enable Ithala to apply for and comply with the bank license requirements in terms of the Banks Act. Our purpose is to provide financial services to the people of KwaZulu-Natal, thereby contributing to the province’s socio-economic development. Our physical footprint spans the entire province of KwaZulu-Natal and, in some rural areas, we still remain the only financial institution with a physical presence.