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Is Afrikaans a Dialect?

Location: News

Is Afrikaans a dialect? This is the question that DF Malherbe sought to answer in 1907 with his doctoral thesis at a German university; 32 years after the founding of the “Genootskap van Regte Afrikaners” (Society of True Afrikaners), which is commemorated today on Afrikaans “Taaldag” (Language Day). It was but one of many small […]

The post Baby steps toward greater significance for a beloved, powerful and beautiful language celebrated today on Afrikaans Language Day appeared first on Freedom Front Plus.

Read moreIs Afrikaans a Dialect?

SA’s Consumer Credit Market Shifted from Recovery to a More Stable Position in Q4 2025

Location: Business
  • Vehicle asset finance closed out a strong year of growth, with Q4 2025 showing improved demand and stronger originations amid softer new vehicle pricing, with better repayment performance
  • Bank personal loans showed continued growth with improved repayment behaviour, while non-bank lenders maintained high growth on smaller value loans while seeing greater repayment pressure
  • Retail and revolving accounts saw softer demand as consumers opted for smaller purchases and Buy Now, Pay Later options at point of sale

TransUnion’s Q4 2025 South Africa Industry Insights Report shows the consumer credit market shifting from a tentative recovery to broader stabilisation driven by steady inflation and interest rates, as well as improvements in consumers’ repayment behaviour. During the quarter there was again notable growth in vehicle asset finance and the personal loans market, while retail credit saw a change in product preference with consumers making smaller purchases. 

South Africa's vehicle finance market continued its expansion in Q4 2025, with a fifth consecutive quarter of sustained growth. The growth in total loan balances continued to outpace new account volumes, indicating a firmer continued recovery in demand supported by a more accommodative interest rate environment following a 25 basis point (bps) repo rate cut in November, which further improved household affordability. Origination volumes rose 9.9% year-over-year (YoY), supported by strong consumer interest in affordable new car models and sustained lender confidence. The average new loan amount also climbed, by 3.3% YoY.

Much of this growth was driven by younger consumers, with Gen Z and Millennials[1] accounting for 66% of all originations. Lenders demonstrated an increased risk appetite, with originations to riskier below-prime borrowers growing by 20.2% YoY. This expansion coincided with positive repayment performance, as account-level delinquencies (the percentage of accounts three or more months in arrears) declining by 59 bps YoY to 6.8%.

The market dynamics were further shaped by a significant shift in the used-to-new vehicle financing ratio, which declined to 0.96 used vehicles for every new one financed, down from 1.56 in Q4 2024. This shift towards more new vehicle financing reflects the availability of budget-friendly new models and favourable inflation trends.

More consumers chose longer loan terms to improve monthly affordability too: in Q4 2025, 56.4% of consumers chose a loan term of 72 months or more, compared to 51.9% who made the same choice one year prior. This marked the first quarter this decade that more than half of consumers chose the longest vehicle finance term available.

“The change in the used‑to‑new finance ratio indicates stronger momentum in new‑vehicle financing and can also be attributed to shifting consumer preferences,” said Ayesha Hatea, director of research and consulting at TransUnion South Africa. “With advancements in technology, new vehicles often offer more features, safety upgrades, and improved fuel efficiency compared to older models, along with longer and more comprehensive warranties.”

“The data on longer loan terms highlights how consumers are adjusting their spending patterns and making strategic financial decisions. By opting for longer loan terms, many are able to manage their monthly payments more effectively and potentially afford a newer or higher-priced vehicle,” she added.

Diverging Strategies Shaped Personal Loan Market

The personal loan market showed a distinct divergence in Q4 2025 as bank and non-bank lenders pursued contrasting growth strategies. Bank personal loan originations grew by 10.2% YoY with average new account amounts up by 10.7% YoY, extending larger loan amounts to lower-risk consumer cohorts. This disciplined approach yielded better repayment performance as account-level delinquencies for bank loans dropped by 271 bps YoY to 27.0%.

Conversely, non‑bank lenders grew their portfolios quickly by shifting toward smaller loans, with average new account amounts down 2.8% YoY and the total volume of originations up 14.7% YoY. Younger borrowers drove a significant portion of this growth, with the volume of new loans issued to Gen Z borrowers climbing 39.6%. However, in contrast to bank lenders, which target relatively better risk borrowers, non-bank lenders’ customer bases are heavily skewed toward the riskiest subprime[2] consumers. As a result of this exposure, account-level delinquencies for non-bank loans remained elevated at 48.0%.

“These trends highlight a clear market split. Banks successfully managed risk while expanding their active books through larger loans to lower-risk borrowers. Meanwhile, non-bank lenders extended credit access to higher-risk borrowers through smaller loans, but faced notable repayment strain,” said Hatea.

Retail Credit Adapted as Buy Now Pay Later Gained Traction

The retail credit sector showed signs of a strategic shift in Q4 2025, influenced by changing consumer behaviours and the growing adoption of Buy Now, Pay Later (BNPL) solutions. While the clothing account sector showed resilience account originations growing by 7.2% YoY, other areas of retail credit saw a decline in new account openings. Retail instalment origination volumes decreased 19.4% YoY, and revolving credit originations fell 16.6% YoY.

This downturn in traditional retail credit originations could be influenced by increasing popularity of BNPL solutions in the market. TransUnion’s Q4 2025 Consumer Pulse Study shows 57% of South African respondents hold a BNPL product, and 36% have used a BNPL product multiple times in the last 12 months to pay for goods and services.

“Consumers appear to be choosing these flexible payment options for smaller credit purchases, drawn to their fixed or interest-free instalment plans,” said Hatea. “However, this trend has not yet significantly affected clothing accounts, which benefit from strong consumer loyalty and accessibility.”

Despite fewer new accounts in some retail segments, possibly also influenced by tighter lending policies, portfolio health shows positive signs. Account-level delinquencies for clothing accounts fell 213 bps YoY to 24.5% and retail revolving delinquencies dropped 238 bps YoY to 17.6%. Lenders also adapted their strategies: the average clothing account limits went up 6.8% YoY, while the average limit for revolving accounts also grew, by 3.9% YoY. This suggests a focus on providing more credit to existing, credit-healthy customers while managing the influx of new, potentially riskier borrowers.

Table 1: Key South African Consumer Credit Market Metrics (Q4 2025 vs Q4 2024)

Product

YoY origination growth

Serious account-level delinquency rate*

YoY basis points (bps) change in delinquency rate
Credit card

8.0%

12.9%

+33 bps
Bank personal loan

10.2%

27.0%

-271 bps
Non-bank personal loan

14.7%

48.0%

+50 bps
Clothing accounts

7.2%

24.5%

-213 bps
Retail instalment

-19.4%

26.8%

-110 bps
Retail revolving

-16.6%

17.6%

-238 bps
Home loans

8.5%

7.5%

+11 bps
Vehicle finance

9.9%

6.8%

-59 bps

*Account-level serious delinquency rate, measured as a percentage of accounts three or more months in arrears

“In Q4 2025, lenders widened access to credit where consumers showed stronger repayment discipline, tightening where risk accumulated and reshaping their portfolios towards lower risk borrowers,” Hatea said. “The data suggests that lenders’ priorities are shifting from stabilisation towards sustainable momentum as they pair cautious growth with sharper exposure discipline, deeper affordability insights and refined product strategies.”

[1] TransUnion age distribution: Gen Z (Born 1995 – 2010); Millennials (Born 1980-1994); Gen X (Born 1965-1979); Baby Boomers (Born 1946-1964)

[2] Scores are based on TransUnion’s CreditVision® generic scoring methodology. Risk distribution key: subprime (0-625), near prime (626-655), prime (656-695), prime plus (696-720), super prime (721-999).

Read moreSA’s Consumer Credit Market Shifted from Recovery to a More Stable Position in Q4 2025

Affordability Drives South Africa’s Strongest New Car Sales in Over a Decade

Location: Business
  • Passenger car sales reached 114,246 in Q4 2025 (up 15.3% year over year), bringing the full-year total to 422,103 – the highest since 2014
  • Chinese brands now account for over 17% of total sales, signalling a structural shift in consumer buying behaviour
  • Younger buyers and affordability-led demand continue to drive momentum as high-income demand normalises

South Africa’s automotive market closed 2025 at its strongest level in more than a decade, supported by easing interest rates, improving vehicle pricing, and a decisive shift in how consumers evaluate vehicle affordability. While headline sales reflect a clear recovery, underlying patterns reveal a market increasingly shaped by value, sharper segmentation and intensifying competition.

According to the TransUnion South Africa Q4 2025 Mobility Insights Report, new passenger vehicle sales reached 422,103 units in 2025, representing 20.1% year-on-year growth. Momentum remained firm into the final quarter, with 114,246 vehicles sold in Q4, making it the strongest quarterly performance based on volume of the post-pandemic period.

“This recovery is real, but it is far from uniform,” says Ayesha Hatea, Senior Director of Research and Consulting at TransUnion Africa. “What we’re seeing is not a return to old buying patterns, but a more deliberate, affordability-driven market where consumers are weighing value, monthly repayments and long-term ownership costs far more carefully.”

Value Brands Cement a Structural Shift

One of the standout trends of 2025 has been the continued rise of Chinese manufacturers. These Chinese brands expanded at nearly nine times the pace of the overall market, lifting their share to more than 17% of total new passenger vehicle sales, up from less than 5% just four years ago.

Aggressive pricing of enhanced specifications, extended warranties and growing consumer trust have fuelled intensifying competitive pressure across all segments of the market.

“This is no longer a short-term disruption,” Hatea explains. “Value brands are now firmly embedded in South Africa’s automotive ecosystem, and their success highlights how decisively affordability and perceived value are influencing purchasing decisions.”

New Vehicles Regain Ground as Pricing Gaps Narrow

Improved affordability conditions shifted demand back toward new vehicles in Q4. New vehicle registrations rose 30.1% year-on-year, compared with just 0.7% growth in used vehicle registrations, narrowing the gap between the two segments. The used-to-new ratio declined to 2.9, down from approximately 3.8 in 2024.

This shift was supported by record-low new vehicle inflation of 1.2%, alongside 1.9% deflation in used vehicle prices, making monthly repayments on new vehicles increasingly competitive.

These trends align with a broader macroeconomic environment focused on easing pressure on household finances, as reinforced in South Africa’s 2026 National Budget delivered by Finance Minister Enoch Godongwana, which emphasised fiscal stability and moderating inflation. Against this backdrop, TransUnion’s data shows vehicle demand remains highly sensitive to interest rates, fuel costs and financing conditions.

“When repayment gaps narrow, buyer behaviour changes quickly,” says Hatea. “But affordability remains the single most powerful lever in sustaining demand.”

Younger Buyers Drive Momentum as Premium Demand Cools

Consumer sentiment showed modest improvement in Q4, with the share of consumers planning to buy a vehicle in the next three months rising from 17% in Q3 to 19% in Q4, according to the TransUnion Consumer Pulse Survey.

That improvement was driven primarily by younger consumers. Gen Z (ages 18-29) purchase intent increased to 25%, while Millennials (ages 30-45) rose to 21%, compared to 14% for Gen X (ages 46-61) and 7% for Baby Boomers (ages 62-80), underscoring a clear generational divide in demand.

At the same time, demand among high-income households has begun to normalise. While consumers in the highest income segment continued to show the strongest purchase intent at 20%, this marked a notable decline from 34% in Q3, indicating a cooling in premium-led purchasing.

“The centre of gravity is shifting,” Hatea notes. “Growth is increasingly coming from younger, more price-sensitive buyers rather than the top end of the market.”

Electrification Advances, on Practical Terms

Electrified mobility continued to gain traction in 2025, with new energy vehicle (NEV) sales reaching approximately 16,700 units, representing 4% of new passenger vehicle sales, up from just 0.3% in 2021.

Growth remains firmly hybrid-led, with traditional hybrids representing nearly three-quarters of NEV sales, reflecting consumer preference for lower upfront costs and limited reliance on charging infrastructure. Battery-electric vehicles remain concentrated among higher-income buyers.

“South Africa’s electrification journey is progressing, but it is pragmatic rather than aggressive,” says Hatea. “Hybrids are bridging the gap between affordability and sustainability.”

A Market Rebalanced, Not Recovered

As the industry looks ahead to 2026, TransUnion’s data suggests a market that has stabilised but remains finely balanced. “The next phase of growth will be incremental and affordability-driven,” Hatea concludes. “Manufacturers, dealers and financiers that align closely with how South Africans are actually buying, not how they bought a decade ago will be best positioned to compete.”

Read the full Q4 2025 TransUnion South Africa Mobility Insights Report here.

Read moreAffordability Drives South Africa’s Strongest New Car Sales in Over a Decade

South Africans Show Determined Optimism as They Adapt to Financial Pressures

Location: Business
  • 72% South Africans say they feel positive about their financial outlook for the next 12 months, showing resilience even as the cost of living remains high
  • Access to credit continues to shape financial confidence, with 91% viewing it as key to achieving their goals, though fewer than half (42%) believe they can access it easily
  • Online scams remain widespread, with 59% of consumers reporting recent fraud attempts, particularly phishing, vishing and gift card schemes

South African households are showing signs of meaningful financial adaptation amid ongoing cost pressures, according to TransUnion’s latest Q4 2025 Consumer Pulse Study. While inflation and affordability challenges persist, consumers are becoming more intentional in their financial management, tightening budgets, prioritising savings, and building greater digital and financial awareness.

“Consumers are entering 2026 with a renewed sense of financial discipline,” said Ayesha Hatea, director of research and consulting at TransUnion South Africa. “We’re seeing households make more deliberate choices, reducing non-essential spending, paying down debt and preparing for the future. This speaks to a financial confidence grounded in awareness and adaptability.”

Financial Adaptation in a High-Cost Environment

Nearly half (48%) of South Africans said their household finances were better than planned in Q4 2025, a sign of growing stability in an economy still defined by high living costs. Yet, 36% of consumers anticipate being unable to meet at least one bill or loan payment in full, revealing the continued strain on affordability.

In response, many households are taking deliberate steps to manage their finances. Half have reduced discretionary spending on non-essential activities such as dining out, entertainment, and travel, while more than a third (34%) have cancelled subscriptions or memberships. At the same time, 38% of consumers plan to increase their contributions toward retirement savings or investments, 35% are accelerating debt repayments, and 27% are setting aside more in emergency funds or stokvels.

These actions suggest that South Africans are not merely reacting to economic pressure but are intentionally strengthening their financial resilience. “Consumers are demonstrating a more strategic approach to money management,” said Hatea. “They’re preserving stability today while laying the groundwork for tomorrow.”

Younger Optimism Meets Experienced Caution

Generational insights reveal that financial resilience takes on different forms across age groups. Younger consumers, particularly Gen Z (18-28 years) and Millennials (29-44 years), tend to be the most optimistic about their financial future and are also the most likely to apply for new credit within the next year, with 42% and 39% expressing this intent, respectively.

In contrast, Gen X (45-60 years) and Baby Boomers (61+) demonstrate a more cautious approach, with only 33% and 9% likely to seek new credit, instead prioritising debt reduction and savings. Spending patterns further illustrate this divide: younger consumers plan to increase their spending on digital services such as internet and other discretionary activities like dining out or travel, while older generations indicate they will prioritise boosting retirement funds and strengthening emergency savings in the coming months.

Credit Access and Inclusion

Credit remains a vital tool for long-term financial mobility, with 91% of South Africans recognising its importance in achieving their financial goals. Yet, access to credit is uneven: only 42% feel they have adequate access, while 33% believe they do not. Despite this strong demand, just 36% plan to apply for new credit or refinance existing debt over the next year, with credit cards (30%), personal loans (28%), and car loans (20%) among the most popular products.

However, 44% of those who considered applying ultimately decided against it, citing barriers such as high borrowing costs (33%), fear of rejection due to their credit history (26%), and concerns over income or employment (24%).

“These findings highlight a need for more inclusive and transparent lending models,” said Hatea. “Consumers believe that a broader use of alternative data, such as rental or buy-now-pay-later payment histories can help extend fair access to credit while supporting responsible borrowing.”

Digital Fraud Threats Drive Demand for Simplified Protection Tools

Digital fraud continues to pose a significant threat to South Africans, with 59% targeted in Q4 and 12% falling victim. The most commonly reported schemes include money or gift card scams (32%), vishing (30%), phishing (29%), and smishing (27%). Despite these threats, 46% of consumers successfully detected and avoided fraud, reflecting growing vigilance. Among those affected by data breaches, 42% changed their passwords, 35% checked accounts for unauthorised activity, 30% closed compromised accounts, and only 16% signed up for identity monitoring.

In the past two months, reacting to security concerns, 58% changed passwords, 23% enabled multi-factor authentication, and 37% checked their credit reports. Yet, many remain unsure how to respond: 53% of those who took no action cited uncertainty about the steps to take, while 22% felt overwhelmed by cybersecurity information.

Empowered and Financially Aware Consumers

Financial awareness among South Africans continues to rise, with 93% recognising the importance of credit monitoring. Engagement with credit reports is also increasing, with 31% checking monthly, 16% weekly, and 8% daily.

Nearly half of consumers believe their credit score would improve if alternative data, such as rental payments or buy-now-pay-later histories, were considered, particularly among younger generations.

“This growing awareness of credit health is encouraging,” said Hatea. “Consumers are becoming more proactive and engaged, and that creates a powerful opportunity for businesses and lenders to support them with relevant, transparent financial tools.”

Building Financial Confidence for the Future

The Q4 findings paint a picture of a nation adapting with purpose, cautious but confident, pragmatic yet forward-looking. As South Africans continue to manage affordability pressures, the emphasis on long-term financial planning, inclusion, and protection is reshaping how consumers engage with the financial system.

“Resilience has become the defining characteristic of South African consumers,” said Hatea. “They’re not waiting for conditions to change, they’re taking control of their financial journeys, showing that confidence and caution can coexist.”

Consumers can get their free annual credit report from TransUnion here.

 

Notes to Editors: An online survey of 992 adults in South Africa was conducted between 25 September and 9 October 2025 by TransUnion with Dynata, using an online panel across desktop, mobile, and tablet. The survey, administered in English, included respondents aged 18 and older from all regions, with quotas applied to ensure demographic representation by age, gender, household income, race, and region. Generational groups were defined as follows: Gen Z (18–28), Millennials (29–44), Gen X (45–60), and Baby Boomers (61+).

Read moreSouth Africans Show Determined Optimism as They Adapt to Financial Pressures

South Africa’s Lenders Adopted Prudent Risk Strategies to Drive Growth in Q4 2024

Location: Business
  • Card issuers rewarded performing existing cardholders with credit limit increases, but offered lower credit limits to new cardholders
  • Consumers increasingly turned to non-bank lenders for personal loans
  • Vehicle loan originations increased for the second consecutive quarter, indicating optimism for the sector

According to TransUnion’s (NYSE:TRU) Q4 2024 South Africa Industry Insights Report, the country’s credit card issuers have adapted their acquisition strategies to enable prudent growth, while effective risk management has led to a decline in account-level delinquencies. During Q4 2024, credit card issuers reduced the average credit card limit on new accounts by 3.9% year-over-year (YoY), while at the same time they increased credit limits on existing credit cards[1] by 5.0%.

The limit increase observations were prominent among prime plus consumers (+4.1% average credit limit increase) and super prime[2] consumers (+1.8%). As a result of higher line access and consumers continuing to leverage credit cards to meet financial and transactional needs, total outstanding balances rose by 7.8% YoY. These insights are echoed in TransUnion South Africa’s Q4 2024 Consumer Pulse Report, where 13% of consumers responded that they had increased their usage of available credit.

An improving performance picture, as observed since Q2 2022, continued as delinquencies (measured as accounts 90 days or more past due) decreased by 34 basis points (bps) YoY during Q4 2024. This trend shows that South African consumers have been able to maintain their credit card payment obligations, while leveraging their cards to navigate the continued high cost of living that has put pressure on disposable income.

“Lenders who are sustaining growth and profitability are drawing on enhanced risk attributes to stimulate a greater share of spend and wallet by identifying consumers who are likely to use credit lines judiciously,” said Lee Naik, CEO of TransUnion Africa. “At a time when new account acquisition is costly, enabling lower-risk consumers to re-engage with their inactive cards, or to extend the use of existing cards, will encourage prudent growth and enable customer loyalty.”

Personal loan lenders target younger borrowers

While personal loan originations from traditional banks declined by 6.2% YoY in Q4 2024, personal loan originations from non-bank lenders increased by 13.9% YoY. Non-bank personal loan originations among Gen Z[3] consumers grew by 48.5% YoY, with this cohort accounting for 15.5% of all non-bank originations.

Non-bank personal loan originations increased YoY across all risk tiers (except for the super prime risk tier, where originations declined by a marginal 1.0% YoY), with the greatest increase seen among prime borrowers (16.1%). However, bank personal loans declined across all risk tiers YoY, except for subprime, where they increased by 6.0% YoY.

Banks are expanding their personal loan offerings to a greater proportion of subprime borrowers. Among bank personal loans, the share of subprime borrowers increased from 53% in Q4 2023 to 58% in Q4 2024, with the share of near prime borrowers remaining consistent across the year. There were minimal YoY fluctuations across the remaining risk tiers. In contrast, the distribution across risk tiers for non-bank personal loans remained consistent over the last two quarters of 2024.

The personal loans market continues to be dominated by younger borrowers, although the total share of originations by borrowers aged 45 and younger did decline marginally in 2024. Seventy-five percent of bank personal loans were granted to Gen X and Millennial customers during Q4 2024, down from 78% one year prior, while 70% of non-bank personal loans were granted to the same age group in Q4 2024, compared to 72% one year prior. At the same time, both lender types are growing their portfolio among the youngest Gen Z borrower group, with 19% of bank personal loans going to Gen Z borrowers in Q4 2024, up from 16% one year prior, and 16% of non-bank personal loans going to these consumers in Q4 2024, up from 12% one year prior.

With respect to credit performance, bank personal loan account-level delinquencies at 90+ days past due dropped by eight bps YoY to 26.6%, while non-bank personal loan delinquencies increased by 452 bps to 40.6%.

“Non-bank personal lenders have a more tolerant risk appetite than banks, and they are responding positively to market demand across age groups and risk tiers,” says Naik. “Lenders that maintain rigorous risk assessment practices that enable greater and earlier prediction of risk, offer education on how to use and manage credit, and empower younger consumers to build their credit profiles, will ensure the continued sustainability of the personal loan market.”

Vehicle loan market continued its recovery path

The vehicle loans market showed encouraging signs of continued growth, as origination volumes increased by 9.6% YoY, and average new loan amounts grew by 1.4%. The greatest growth in originations was observed among Gen Z consumers, where originations grew by 27.9%, although their share of total new finance agreements remains relatively low compared to older age groups. This is the second consecutive quarter in which total vehicle loan originations grew YoY, with the last increase in origination volumes before these two increases having been in Q3 2022. Given the 0.25 bps decrease in interest rates as of November 2024 and a positive outlook for consumer confidence, the vehicle loan market is expected to continue this recovery trend.

These positive trends were also evident in the Q4 2024 TransUnion South Africa Vehicle Pricing Index, that revealed a growing share of financed vehicles within the R250,000 to R750,000 price range. This shift suggests that, while affordability may still be a concern, consumers are prioritising flexible financing solutions and adjusting their purchasing behaviour to align with available credit and economic conditions.

“While the two recent interest rate decreases were just 25 basis points each, the significant increase in new vehicle loan originations indicates that South Africans are becoming more optimistic about their financial futures,” says Naik. “While vehicle ownership is aspirational for many individuals, it’s also the key to unlocking growth for entrepreneurs, and the owners of micro and small enterprises, all of whom are the engines of economic growth in South Africa.

“As part of our drive to expand financial inclusion, TransUnion has included a wide range of alternative data into our scoring solutions, so that more South Africans are more visible in our risk scoring models, in turn creating the platform for them to access finance for the first time.”

 Table 1: Key South African Credit Market Metrics (Q4 2024 vs Q4 2023)

Product

YoY origination growth

Serious account-level delinquency rate*

YoY basis points (bps) change in delinquency rate
Credit card

5.6%

12.0%

-33 bps
Bank personal loan

-6.2%

26.6%

-8 bps
Non-bank personal loan

13.9%

40.6%

452 bps
Clothing accounts

-4.0%

26.4%

-143 bps
Retail instalment

14.9%

27.5%

-204 bps
Retail revolving

11.9%

14.5%

-500 bps
Home loans

-13.2%

7.1%

26 bps
Vehicle finance

9.6%%

4.8%

13 bps
 *Account-level serious delinquency rate, measured as a percentage of accounts three or more months in arrears

 

  • [1] Credit card accounts that are currently open and active in the portfolio.
  • [2] Scores are based on TransUnion’s CreditVision® generic scoring methodology. Risk distribution key: subprime (0-625), near prime (626-655), prime (656-695), prime plus (696-720), super prime (721-999).
  • [3] TransUnion age distribution: Gen Z (Born 1995 – 2010); Millennials (Born 1980-1994); Gen X (Born 1965-1979); Baby Boomers (Born 1946-1964
Read moreSouth Africa’s Lenders Adopted Prudent Risk Strategies to Drive Growth in Q4 2024

South Africa’s Consumer Credit Market Sees Targeted Growth in Key Products, Despite New High in Personal Loans Delinquencies

Location: Business
  • Credit card originations rose by 30.7% as demand grew, with below prime originations up by one third year-over-year (YoY)
  • Vehicle finance originations grew significantly YoY, indicating growing momentum in the automotive industry
  • Non-bank personal loans saw highest delinquency rate since previous high point in Q2 2021

According to TransUnion’s (NYSE:TRU) Q1 2025 South Africa Industry Insights Report, the growth in originations of new credit cards, at 30.7% year-over-year (YoY), far outstripped growth for other consumer credit products during the first quarter of the year.

Strong growth in credit cards was driven, in part, by lenders extending cards to more below prime[1] borrowers than they did one year ago – up 33.1% YoY. Subprime and near prime borrowers accounted for 69.3% of credit card originations, up from 64.3% one year earlier. At the same time, lenders looked to actively manage the increased risk profile of borrowers by limiting the average credit limit on new credit cards – down 13.1% YoY.

Growth is likely to remain buoyant in the South African credit card market, with 33% of respondents to TransUnion’s recent Q1 2024 Consumer Pulse Survey saying that they planned to apply for a new credit card in the next 12 months.

Credit card average account balances increased by 7.1% YoY, although lenders’ default concerns may have been eased by the 20-basis point (bps) decrease in account-level delinquencies* over the same period, standing at 12.3% in Q1 2025.

“While inflation has dropped to the low end of the South African Reserve Bank’s target range during Q1 at close to 3%, South Africans are still experiencing financial pressures from prior price increases, turning to credit to help them make ends meet,” says Ayesha Hatea, director of research and consulting at TransUnion. “Despite these strains, consumers have increasingly prioritised keeping their credit cards in good standing, as they likely want to ensure access to the ongoing liquidity that this credit product provides.”

Vehicle loans grew at double-digit rate

The vehicle loans market continued to show encouraging signs of continued growth, as origination volumes increased by 11.6% YoY in Q1 2025. The average value of new loans also rose by 3.0% over the same period.

The highest growth rate continued to be among Gen Z[2] consumers, up 28.5% YoY. Within the Gen Z cohort, 62% of new vehicle loans were opened by consumers in the oldest subgroup in this generation, aged 26 to 29 years. This trend suggests that older Gen Z consumers are becoming increasingly active in the vehicle finance market, likely as they reach key life stages such as career stability and household formation. While this group is not necessarily New-to-Credit, their growing share of originations highlights a valuable opportunity for lenders to engage younger, upwardly mobile consumers.

In contrast, the share of vehicle loans declined across all other generations, with the exception of Gen X, where volumes remained relatively stable. This reinforces the importance of targeting older Gen Z consumers as a key growth segment in the vehicle finance space.

With a 0.25% repo rate cut announced by the South African Reserve Bank (SARB) in January followed by another in May, demand for vehicle loans is likely to remain buoyant, with more than one fifth (22%) of South Africans surveyed in the TransUnion Q1 Consumer Pulse Survey indicating that they intend to take out a new car loan or lease in the next 12 months.

“With vehicle ownership is a priority due to limited public transport offerings, buying a vehicle is often a first step into secured credit for young professionals,” said Hatea. “Vehicle finance often requires relatively small deposits, and flexible financing options can be negotiated to make monthly repayments more affordable. Borrowers don’t need as extensive a credit history to purchase a vehicle as they do to buy a home. Successfully managing a vehicle loan demonstrates financial responsibility, which can strengthen future home loan applications.”

Personal loans leveraged for meeting monthly expenses

During the first quarter of the year, consumers also increasingly turned to personal loans as strategic tools to achieve their financial objectives, with originations growing for both bank and non-bank personal loan lenders – up 2.7% and 11.5% YoY, respectively. Demand for personal loans will likely continue, with 35% of surveyed South Africans saying that they intend to apply for a personal loan in the next 12 months.

However, non-bank lenders may yet have to refocus their risk management strategies in the coming months as more than two in five (41.3%) of South Africans who hold one of these loans – 83.9% of whom are below prime borrowers – being three months or more in arrears during Q1 2025. This is a 520-basis point (bps) YoY increase and is the highest delinquency rate for this product since the previous high of 39.1% in Q2 2021.

The delinquency rate among non-bank personal loans was 15 percentage points higher than delinquencies on bank personal loans, where below prime borrowers comprise 71.8% of the bank personal loans book.

“South Africans are increasingly turning to low-value personal loans with shorter repayment terms to manage their monthly expenses. However, persistently high delinquency rates — particularly among non-bank personal loans — indicate that many consumers are under significant financial pressure and struggling to meet their loan commitments,” says Hatea. “As lenders respond to growing demand for this type of credit, it’s essential they align their growth strategies with prudent risk management to ensure long-term sustainability.”

Home loans remain under pressure

Home loans were the only sector to experience a decline in originations in Q1 2025, down 10.8% YoY. Although originations fell across all risk tiers, loans to prime and above consumers saw a particularly sharp decline, down 21.1% YoY. This continues the downward trend in home loan growth observed since Q1 2020, with exception of a moderate YoY increase between Q1 2022 and Q1 2023.

“The fact that even prime consumers are pulling back from the housing market is a clear signal that affordability remains a significant barrier,” said Hatea. “This trend has implications not only for the credit market, but also for broader economic activity tied to home ownership and property development.”

As the housing finance sector continues to soften, lenders may need to reassess their strategies. This includes rethinking product design and pricing, as well as how they connect with younger consumers and first-time buyers, in order to reignite demand in a segment that has traditionally served as a foundation of secured lending.

 Table 1: Key South African Credit Market Metrics (Q1 2025 vs Q1 2024)

Product

YoY origination growth

Serious account-level delinquency rate*

YoY basis points (bps) change in delinquency rate
Credit card

30.7%

12.3%

-20 bps
Bank personal loan

2.7%

26.3%

14 bps
Non-bank personal loan

11.5%

41.3%

520 bps
Clothing accounts

7.6%

25.9%

-294 bps
Retail instalment

16.0%

27.1%

-138 bps
Retail revolving

5.4%

14.9%

-350 bps
Home loans

-10.8%

7.4%

19 bps
Vehicle finance

11.7%

5.4%

-1 bps

 *Account-level serious delinquency rate, measured as a percentage of accounts three or more months in arrears

[1] Scores are based on TransUnion’s CreditVision® generic scoring methodology. Risk distribution key: subprime (0-625), near prime (626-655), prime (656-695), prime plus (696-720), super prime (721-999).

[2] TransUnion age distribution: Gen Z (Born 1995 – 2010); Millennials (Born 1980-1994); Gen X (Born 1965-1979); Baby Boomers (Born 1946-1964

Read moreSouth Africa’s Consumer Credit Market Sees Targeted Growth in Key Products, Despite New High in Personal Loans Delinquencies

South Africans Signal Cautious Confidence as Financial Habits Evolve

Location: Business
  • TransUnion’s Q2 2025 Consumer Pulse Study reveals strategic shifts in saving, borrowing, and fraud defence, with younger generations leading the way
  • 75% of South Africans expect their income to rise, but nearly 39% anticipate missing at least one bill or loan payment
  • 45% of Gen Z and 39% of Millennials plan to apply for credit, leading a shift toward more proactive financial habits
  • 58% of consumers were targeted by fraud in Q2, with many responding by strengthening their digital security

South African consumers are responding to ongoing financial pressures with increasing intent and vigilance. While inflation, high interest rates and job market uncertainty continue to weigh on household budgets, the latest TransUnion Consumer Pulse Study for Q2 2025* reveals a population adjusting not just defensively, but proactively. From rethinking spending and saving to becoming more discerning about credit and fraud, South Africans are adopting behaviours that suggest a shift toward long-term financial resilience, especially among younger generations.

“South Africans are showing resilience with purpose,” said Ayesha Hatea, director of research and consulting at TransUnion. “They’re not simply reacting to pressure, they’re taking charge, rebalancing their finances and protecting their future.”

Mixed Incomes, Bold Adjustments

While there are some positive signs, many households are still experiencing fluctuations in their income. In the second quarter, 21% of consumers said their household income had decreased, while 38% reported an increase. A majority of respondents (75%) are hopeful that their earnings will increase in the next year. However, this confidence exists alongside financial challenges, with nearly 39% of consumers reporting that they expect they might miss at least one bill or loan payment in the near future.

This financial pressure is driving noticeable changes in how people manage their money. More than half of consumers (54%) trimmed back on non-essential expenses like dining out, entertainment and travel. Many are also taking steps to strengthen their financial security; 31% paid down debt faster, 24% put more into emergency savings or stokvels and 37% planned to increase their retirement or investment savings.

Generational Differences Define the Shift

While overall behaviours are trending positive, the evolution is not uniform across age groups. Younger consumers, particularly Gen Z (ages 18-28) and Millennials (29-44) are emerging as drivers of this transformation. They are more likely to apply for credit, monitor their credit reports frequently and adopt security tools like multi-factor authentication.

Forty-five percent of Gen Z respondents and 39% of Millennials indicated they plan to apply for or refinance credit in the next year, compared to just 27% of Gen X (45-60) and 15% of Baby Boomers (61+). They are also the most engaged in monitoring their credit monthly and believe that access to alternative data, such as rental or Buy Now Pay Later (BNPL) payment histories, would improve their credit scores.

“Younger South Africans are embracing financial tools with growing confidence,” Hatea added. “They’re more comfortable with digital platforms, increasingly aware of how their financial choices affect their long-term goals, and, as a result, are more proactive about managing their credit.”

Cautious Credit Intent Amid Access Concerns

While 92% of consumers believe access to credit is important to achieving their financial goals, only 36% intend to apply for credit in the coming year, a figure that has remained stable since Q1. This cautious demand reflects continued uncertainty around employment, income and affordability.

Consumers favour unsecured lending, with credit cards (30%), personal loans (28%) and BNPL services (25%) attracting the most interest. Interest in secured lending remains comparatively low, with only 22% planning to apply for vehicle finance and 19% expressing interest in home loans.

Still, barriers remain. Nearly half (48%) of consumers said they had considered applying for credit but ultimately decided not to. The main reasons were income/ employment status (30%), high borrowing costs (29%) and concerns about their credit history (27%). Overall, 45% of consumers believed they would be approved if they applied for credit. While this figure reflects general sentiment, optimism tends to be higher among those who actively monitor their credit, suggesting a link between financial awareness and confidence.

Digital Fraud on the Rise, but So Is Awareness

As digital engagement grows, so does the threat of fraud. In Q2 2025, 58% of South Africans reported being targeted by fraud schemes, a decrease from the previous quarter (61%) with 13% confirming they had fallen victim. The most common scams included gift card or money transfer scams (33%), phishing (31%), smishing (30%) and third-party seller scams (28%).

Consumers are responding with heightened vigilance in response to cyber security concerns. A majority (59%) changed their passwords, 39% checked their credit reports and 25% added multi-factor authentication. Gen Z and Millennials were the most likely to take protective action, a likely result of both their greater exposure to digital platforms and higher awareness of evolving scam tactics. Alarmingly, 21% of consumers said they took no action at all, often citing uncertainty about what to do. This highlights the ongoing need for stronger cybersecurity and fraud education, and accessible protection tools.

“Consumers are trying to keep pace, but the threat landscape is evolving quickly,” said Hatea. “What we need now is a national conversation, one that gives all South Africans the knowledge and resources to protect their identities in a digital-first world.”

A Financial Turning Point

The Q2 2025 Consumer Pulse Study reveals a country making deliberate financial choices in the face of uncertainty. South Africans are shifting from survival mode to a more balanced, future-focused financial mindset. While challenges remain, the direction is clear; consumers are becoming more selective in how they spend, more strategic in how they borrow and more vigilant in how they protect themselves.

“At TransUnion, we believe these shifts represent not just resilience, but growth,” concluded Hatea. “South Africans are taking ownership of their financial journeys and in doing so, they’re laying the groundwork for lasting stability and inclusion.”

Consumers can get their free annual credit report from TransUnion here.

* This online survey of 922 adults was conducted May 5–25, 2025

Read moreSouth Africans Signal Cautious Confidence as Financial Habits Evolve

South Africa’s Automotive Market Accelerates to 11-Year High as Value Brands and Younger Buyers Drive Momentum

Location: Business
  • 111 697 new passenger vehicles sold in Q3 – up 23.4% year-on-year, the highest quarterly total since 2014
  • Chinese brands captured a record 15%+ market share, growing almost nine times faster than the market average
  • Passenger-vehicle exports rebounded 4.1% year-on-year, powered by a 63.7% September surge to a six-year high

South Africa’s automotive market shifted into top gear in the third quarter of 2025, posting its strongest sales performance in more than a decade as greater macro-economic stability, easing interest rates and a firmer rand supported renewed consumer demand. According to TransUnion’s Q3 2025 Mobility Insights Report, total new-passenger-vehicle sales reached 111 697 units, 23.4% higher year-on-year (YoY), while new vehicle inflation dropped to a record low of 1.5% (since tracking began in 2008), creating one of the most competitive pricing environments in recent memory.

“Affordability and choice are redefining South Africa’s automotive landscape,” says Lee Naik, CEO TransUnion Africa. “Consumers are seeking greater value and flexibility and manufacturers that meet this demand through innovation and pricing discipline are winning the race for growth.”

Affordability Drives Record Growth and Market Realignment

Although established OEMs returned to positive growth in Q2 and Q3 2025, the market’s transformation is being led by Chinese manufacturers expanding nearly nine times faster than the overall market, with YoY growth of 89% in Q2 and 88% in Q3.

Their combined share has quadrupled since 2021 to more than 15%, powered by competitively priced, feature-rich SUVs and sedans that appeal to cost-conscious yet tech-savvy buyers. Top-performing value brands YoY included JAC (67% volume increase), GWM (54%), Mahindra (42%) and Chery (35%), while BMW (27%) proved that premium marques can still thrive by combining desirability with strong product pipelines.

“This isn’t a short-term surge, it’s a structural reset,” adds Naik. “The success of value-driven models shows how affordability, technology and trust are now the true levers of brand growth in South Africa.”

Younger and High-Income Buyers Sustain Demand

Despite surging sales, TransUnion’s recent Consumer Pulse Survey shows a modest easing in purchase intent, with the share of respondents likely to buy a vehicle in the next three months declining from 19% in Q2 to 17% in Q3. The report suggests that current sales momentum is being driven primarily by pent-up demand, dealer incentives and fleet renewals, rather than broad-based consumer confidence.

Purchase behaviour also remains sharply segmented across both age and income groups. Younger consumers continue to lead intent, with 21% of Gen Z and 19% of Millennials planning to buy a vehicle in the next three months, compared to 13% of Gen X and 8% of Baby Boomers. From an income perspective, high-income households earning R200 000 or more per month show the strongest intent at 34%, while middle- and lower-income consumers remain significantly more cautious in their purchasing outlook.

Electrification: A Tale of Price and Generation

Internal-combustion vehicles (ICE) remain the single largest category in consumer purchase intent, accounting for 42% of consumer preference, while interest in hybrid (39%) and plug-in hybrid (24%) models is steadily increasing. The shift toward electrification is most pronounced among Gen Z consumers, with 55% favouring hybrids and 32% considering battery-electric vehicles (BEVs).

This generational shift toward greener technology is evident among high-income buyers, with 75% considering plug-in hybrids, driven primarily by their perceived affordability. In contrast, preference for ICE vehicles remains largely affordability-based among lower-income segments. Higher budgets within affluent households enable greater consideration of hybrid electric (HEV), plug-in hybrid (PHEV), and battery electric vehicles (BEV), reinforcing an emerging “electrification divide.” This dynamic presents a significant opportunity for OEMs and financiers to tailor product offerings and financing strategies to meet the distinct needs of different age and income segments.

Connected Cars: Data Becomes the New Engine

Q3’s Mobility Insights Report special feature, The Connected Road, explores how connected-car technology is transforming mobility. Connectivity is now standard in most post-2015 vehicles, enabling real-time navigation, predictive maintenance, remote access, and advanced safety systems. Yet global data warns of “connectivity fatigue”: Over three quarters (76%) of drivers internationally don’t subscribe to connected services, mainly due to cost.

Naik says: “South Africa has a chance to leapfrog global missteps by focusing on value-adding applications, safer driving, cheaper insurance and smarter maintenance rather than gimmicks.”

Exports Rebound and Dealer Confidence Climbs

Passenger-vehicle unit exports rose 4.1% YoY after a steep Q2 contraction, driven by a 63.7% September surge that lifted shipments to a six-year high. Meanwhile, the RMB/BER Motor Traders Confidence Index advanced to 54, marking its second net-positive reading of 2025 and notably placing it above the neutral 50-point mark, which signals growing dealer optimism amid sustained sales momentum and improving export conditions.

Balancing Value and Transformation

The convergence of affordability, segmentation, electrification, and connectivity signals a pivotal shift in the automotive industry. “The future belongs to brands and financiers that master both the value-driven present and the connected, electrified future,” concludes Naik. “Data-led insight will be the bridge that connects today’s strategies with tomorrow’s innovation

Read the full TransUnion South Africa Q3 2025 Mobility Insights Report here.

Read moreSouth Africa’s Automotive Market Accelerates to 11-Year High as Value Brands and Younger Buyers Drive Momentum