Johannesburg - Consumer credit health in South Africa
declined between the first and second quarters this year, according to the
results of the Transunion consumer credit index released on Tuesday.
The consumer credit index (CCI), a measure of credit health,
declined to 50.7 in the second quarter of 2012 from a revised 54.4 (previously
55.7) in the first quarter this year.
This reasserted a downward trend that began in the fourth
quarter of 2010, having risen in the first quarter of 2012, reflecting rising
consumer loan impairments, tighter real aggregate monetary conditions, and
marginal increases in debt service costs.
Even though it declined, the index remained above the key
50.0 level, indicating consumer credit health was not deteriorating, even if it
was only improving very marginally or holding steady.
The rise in impaired accounts at a time when aggregate
national debt servicing costs did not appear to be rising particularly strongly
suggested that impairments may be concentrated in isolated markets.
The unsecured loan market stands out as a likely source,
according to the CCI.
Slightly tighter monetary conditions than in the previous
quarter and persistent non-discretionary goods and services inflation has led
to tighter household financial conditions.
However, on the whole household cash flow appears to still
be fairly healthy, the CCI indicated.