Banks, lenders aren't feeding consumers' increasing appetite for credit | Business

Data from the NCR, TransUnion and Experian shows that banks are still lending less than they did before the pandemic.In other credit lines, lenders have been approving lower credit limits and rejecting a bulk of applications.South African banks never fully opened their lending taps after the Covid-19 pandemic. And just as more consumers turn to debt to cope with the spiralling cost of living, lenders are tightening their appetite again.

The TransUnion industry insight report has a month lag on credit origination data. But it still paints a solid picture of how banks and other lenders responded to the increased appetite for credit. It shows that credit originations increased by 14.5% year-on-year in the second quarter. Credit card origination volumes saw the biggest increase at 39.4%, followed by clothing accounts and retail revolving credit facilities .

For instance, card originations volumes were 18% below pre-pandemic levels. And even when one compares the current numbers to 2021 instead of 2019, the growth in new cards issued doesn't match the outstanding balances. Outstanding balances decreased by 2.2% year-on-year in the third quarter of 2022, indicating that while people might be getting new credit cards, lenders are giving them smaller credit limits than before.

"We've seen from the NCR's Consumer Credit Market Report that although the demand for credit continues to exceed even levels we saw pre-Covid-19, the approval rate of these applications remains really low at 33%. The high demand for credit is explained by the increased cost of living.

_Business I thought you guys wanted Ramaphosa for the second term

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