Business, consumer confidence in first gear

PHIILEPUS UUSIKUBusinesses in the mining, retail and manufacturing sectors are the main drivers of the increase in credit uptake as credit extended to corporates in February increased by 1.6% year-on-year, compared to a growth of 1.0% recorded in January this year.On a monthly basis, credit extension to businesses contracted by 0.6% after posting a positive growth of 1.3% in January, according to IJG private sector credit extension (PSCE) statistics.Only the Other Loans and Advances (OLA) category, which is made up of credit card debt, personal and term loans increased both on a monthly and annual basis, recording a growth of 1.9% and 1.4%, respectively, IJG pointed out.As for households, credit extended to individuals increased by 2.6% year-on-year in February, on par with January’s increase of 2.5% year-on-year. On a monthly basis, household credit grew by 0.5% following the decrease of 0.7% recorded in January. The value of mortgage loans extended to individuals grew by 0.8% month-on-month and 4.5% year-on-year.Instalment credit remained depressed, increasing by 0.1% month-on-month, but contracting by 4.1% year-on-year. Overdraft facilities extended to individuals have increased by 0.3% month-on-month, but dipped back into negative territory, contracting by 0.3% year-on-year, IJG said.Overall, private sector credit extension (PSCE) increased by just N$3.2 million in February, bringing the cumulative credit outstanding to N$105.6 billion. On a year-on-year basis, private sector credit grew by 1.76% in February, compared to 1.50% year-on-year in January. On a rolling 12-month basis, N$1.82 billion worth of credit was extended to the private sector. Of this cumulative issuance, individuals took up credit worth N$1.52 billion, while N$687.4 billion was issued to corporates. The non-resident private sector decreased its borrowings by N$382.9 million.OutlookIJG notes that economic activity remains very low and a lack of demand means that growth opportunities for businesses remain extremely slim. The subdued uptake of credit by businesses, shows that they are currently not investing in capital projects, despite the historically low interest rates in the country.“While economic growth is expected to pick up marginally this year, economic activity will most likely remain below 2019 levels. Therefore, we do not expect to see a significant recovery in credit extension in the short to medium term,” IJG added.The overall liquidity position of commercial banks improved during February, increasing by N$727 million to reach an average of N$1.50 billion. The increase was largely due to proceeds from mineral sales during the month. The outstanding balance of repo’s fell from N$845.7 million to zero by month-end, IJG said.

Business, consumer confidence in first gear

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Republikein 2026-07-03

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Business, consumer confidence in first gear

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Republikein 2026-07-03

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