BoN leaves repo unchanged
Nearly half of people interviewed in the Namibia Financial Capability Survey 2017 “seldom” manage to make their money last until the next time they receive money.
Of the 2 144 households surveyed in all regions, 48.9% said they often run out of money before pay-day. In 2013, only 39% gave the same answer.
Nearly 19% indicated that they sometimes reduce or miss a monthly payment on a loan without making arrangements with the service provider. In 2013, only 13% resorted to this measure. About 32% sometimes asks the service provider for a breather compared to 31% in 2013.
27.5% of respondents only make a payment when they have enough money to do so. Five years ago, it was 29%.
Asked how long they would be able to continue to cover their living expenses if they lost their main source of income and would borrow or change their living standards, the majority (17.4%) said two weeks to less than four weeks. In 2013, 15.1% of respondents fell into this category. 16.4% said four weeks to less than six weeks, up from 10.9% in 2013.
Just over 12% will be able to last six months or more, down from 15% five years ago.
The survey forms part of the Financial Literacy Initiative of government and the Bank of Namibia.
Struggling consumers yesterday gave a sigh of relief when the governor of the BoN, Ipumbu Shiimi, announced that the repo rate will remain unchanged at 6.75%. This means the prime lending rate of local commercial banks will stay at 10.5%.
Shiimi said unproductive consumer lending like structuring consumption loans worries the BoN.
The latest central bank data shows that consumer debt for “other loans and advances”, which include personal loans and credit cards, is still growing at double digits. By the end of October, consumers owed nearly N$6.6 billion in other loans and advances – about N$970 million or 18.7% more than in October 2017.
Total overdraft debt stood at nearly N$3.08 billion, an increase of 10.6% or 0.3% compared to October 2017.
Consumers remain wary to take on more instalment credit. By the end of October, instalment debt was about N$430.7 million less than a year ago and totalled nearly N$6.8 billion.