More articles in this category
Top Stories

 Experts are concerned that if the current scourge of road accidents continue non-stop, the country risks running its pockets dry as millions...

Outspoken land activist, Job Amupanda has written a letter to the Oranjemund Town Council objecting to the granting of an erf to the trade ministe...

Windhoek mayor, Muesee Kazapua, said that the city will not be allocating land to applicants who plan on building churches. The city said it wi...

A police officer accused of leading what has been called a brutal assault on civilians in Okakarara has been transferred to another station, the O...

As Africa plunges into mourning following the death of the seventh Secretary-General of the United Nations (UN), Kofi Annan this past weekend...

Namibia's national rugby team will be heading to the Rugby World CUP 2019 in Japan, after qualifying against Kenya in a 53-28 game in the Afri...

Other Articles from The Villager

Credit extended not enough to boost consumer spending- Simonis Storm

03/08/2018
by Kelvin Chiringa
Business

As business and consumers remain under pressure due to the weak economy exacerbated by limited government expenditure, Simonis Storm has noted that the amount of credit extended so far is not enough to boost consumer spending.

Their view comes in the wake of the Bank of Namibia having released the money and banking statistics for June 2018.

According to the latest data, Private Sector Credit Extension increased at a slower pace of 5.5% at the end of June 2018 compared to a 7.3% registered in the prior year.

Instalment credit was at record low levels of -5.6% year-on-year at the end of June 2018, while overdrafts stumbled to 0.6% y-o-y in June compared to a 16.1% recorded in the prior year.

On the contrary, credit extended through other loans and advances increased by 10.9% y-o-y in June 2018 compared to a 6.8% registered in the prior year.

Household debt increased by 6.4% to N$54.6bn in June compared to an 8.3% in the prior year.

This is the lowest growth since January 2010. Moreover, credit through unsecured lending continued to register a staggering growth of 11.6% y-o-y at the end of June, fuelled by an increase of 112.2% y-o-y in lease contracts by individuals.

Says Simonis Storm Securities’ Indileni Nanghonga, “In our view the credit extended is not ample to boost consumer spending in these tight economic conditions. Consumers will remain under financial pressure which is currently exacerbated by the rise in petrol prices (inflationary).”

Meanwhile corporate debt rose by 4.2% to N$37.3bn in June compared to a 5.9% in the prior year.

Households and corporates totals N$91.9bn in PSCE debt, a 196.5% escalation over the last 10 years.