The rising cost of living, record petrol price increases, and higher interest rates all point to middle-class South Africans having less disposable income in the coming months, says FNB.
The rising cost of living, record petrol price increases and higher interest rates all point to middle-class South Africans having less disposable income in the coming months, says FNB., released on Wednesday, the bank noted that the rising cost of living played a key part in its decision to freeze or introduce below-inflation increases on its accounts.
In addition, salaried middle-income consumers with secured and unsecured credit spend, on average, 30% of their income on unsecured credit and 35% on secured credit, the lender said. “The expected increase in the repo rate of 100 to 125 basis points through 2022 from 2021 levels could well leave some lower-middle to middle-income households paying more for recently acquired vehicles or properties to the extent that they would be forced to ‘buy down’ or cancel other discretionary spending items such as insurance and savings products.”
The group said that the debt-stressed segment – around 40% of respondents – has been consistent for the last four years, pointing to a fairly stable middle-class financial position. The survey was based on 33,000 respondents from households earning more than R10,000 a month.
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