According to South African debt counsellor Debt Busters Payment holidays offered during the three-month period from April to June 2020 will cost an additional R20.7billion in debt for the estimated 1.6 million South African consumers who participated.
The company says while payment holidays were very good news for people facing a short-term cash crunch they came at a cost. This is as a result of interest accumulating on the debt owed, even though payments were put on hold for a while. DebtBusters’ analysis was conducted based on the profiles of typical consumers who applied for debt counselling over the past year. The analysis includes a breakdown of how a three-month payment holiday affected these consumers’ levels of debt.
To help us unpack the discussion we are now joined on the line by:
• Benay Sager, DebtBusters’ chief operating officer
• Rose Molokoane from Savings Institute
• Ian Cruickshanks is an economist
