As the country focuses on each segment of the past year in bite-size chunks, from politics and virus to financial and business impacts—what is the impact of the past year percentage-wise? And just how much of an impact have the past months had on people’s worlds?
TransUnion, a consumer credit reporting agency, has conducted research to better understand consumers’ perceptions and expectations on how the highly volatile year is affecting their financial situation and people’s ability to pay their bills. With the online survey involving 1100 participants and taking place from 1 November 2020 to 3 November 2020, TransUnion was able to compile an informative view on how we as a country are coping.
Getting right into it, as of November, 79% of South Africans continue to be financially impacted by the past year. What is profoundly disturbing, this is up 2 percentage points from October.
Moreover, 35% of participants have had their work hours reduced, and job losses have inflated by 19% since TransUnion’s survey in October.
When stepping out of the work environment and looking into peoples homes—South African families are feeling the brunt of 2020. In the survey, 65% of participants say their household finance is worse than planned. In fact, when it comes to managing household budgets, 85% of people are concerned about their ability to pay bills and loans. Out of this figure, 29% are expecting to run into a shortfall within one month.
Additionally, on average, people are expecting to see an R 7 424 shortfall in paying for their bills. To add to their financial woes, people impacted by the past year, presume they will not be able to pay their bills or loans in 8.4 weeks.
With the above realities in mind, TransUnion has made a worrying discovery. South Africans are still cashing out investments and retirement savings to maintain cash flow throughout the crisis, with 42% of respondents indicating this is how they will pay current bills and loans.
Furthermore, with people cutting back on their discretionary spending and looking forward three months, 64% of consumers expect to spend less on dining out, travel and entertainment purchases. The retail sector may come under pressure as 54% indicate they will spend less on retail, which may affect the economy as we approach the holiday season.
With South Africans facing overwhelming financial challenges this festive season, how positive are you that 2021 will hold more promise than this year? Share your thoughts and views with us in the comment section below.
Author: Quinton Boucher
Edited: Calvin Swemmer