Revelations this week shows that about 117 000 Namibians cannot afford to acquire any more debt because they are blacklisted for failure to service their earlier dues with institutions such as banks, clothing shops or furniture shops.
Statistics show that about 780 000 Namibians qualify for debt although 117 000 of those do not qualify for any more debt. The statistics released by TransUnion give an indication on how many Namibians struggle for financial discipline at a time the standards of living are soaring beyond the capabilities of many.
TransUnion Namibia has listed about 117 000 Namibians who have accrued bad debt, or were unable to live up to their end of a contract.
According to statistics availed by TransUnion Namibia, credit bureaus in Namibia make it possible for about 780 000 consumers to buy now and pay later. However an estimated 15% of those people are blacklisted. The Credit Bureau Regulations, which was gazetted on 31 July 2014, requires that all credit bureau institutions in Namibia be registered and licensed with the Bank of Namibia (BoN).
Ironically this comes at a time when the central bank Governor, Ipumbu Shiimi, has raised red flags over the uncontrolled borrowing from Namibians to finance luxuries. Shiimi’s concern has been that most Namibians are involved in borrowing to finance none productive or essential goods at the expense of projects that can stimulate the economy.
Perhaps a lesson to those who find themselves in a situation where they cannot borrow anymore is to learn to live within their means. It is actually fun that some of the blacklisted individuals are in that situation because they might have bought such as overly expensive designers label clothes, shoes and other none essentials.
These are obviously expenditures that can be avoided if people inculcate a sense of control on their finances. Speaking to The Villager, BoN Director of Strategic Communications and Financial Sector Development, Ndangi Katoma, has advised that consumers, businesses, government and Central Banks use credit bureaus to help them over indebtedness of maintaining and ensuring financial stability.
“Household indebtedness of Namibians remains high by regional and international comparisons. This calls for more concerted efforts in monitoring debt at microeconomic levels, particularly for mortgages and instalment credit to individuals, components which dominate credit to the private sector, which could potentially lead to systemic risk in the financial sector is not managed well,” he said.