As festive spending peaks, CASA urges South Africans to make responsible credit decisions

As South Africans navigate the ongoing bustling festive season, marked by gift-giving, travel plans, and social gatherings, the Credit Association of South Africa (CASA) has stepped forward to advocate for responsible credit practices. This time of year, while joyous, can also put an undue strain on household budgets, and CASA’s CEO Leonie van Pletzen has voiced her concerns over the potential pitfalls consumers may face.

"This time of year typically places additional strain on household budgets," said van Pletzen. She emphasises that the festive season often brings various expenses, including gifts, holiday entertainment, and the dreaded January back-to-school costs, which can tempt consumers to borrow beyond their means.

Van Pletzen warns that hasty financial decisions made during this period can lead to significant financial stress in the new year. "Credit can be a helpful tool, but only if used responsibly through registered providers who comply with the law and prioritise the protection of consumers," she cautions. "Informal or illegal lending continues to target vulnerable households over this period, making awareness and accountable decision-making more important than ever."

In a bid to empower consumers this festive season, CASA offers seven expert tips aimed at enhancing financial wellbeing:

• Set a realistic festive-season budget: Plan for all expected expenses, including gifts, travel, and food, ensuring you only spend what you can genuinely afford.
• Only borrow if you can afford to repay it: Assess whether your monthly repayments will fit comfortably into your budget, always prioritising essential living costs.
• Borrow only from NCR-registered credit providers: Ensure your credit provider is registered with the National Credit Regulator (NCR), as they must adhere to legal standards.
• Use your bonus or 13th cheque smartly: Consider paying off existing debts or boosting savings rather than spending it all immediately.
• Prioritise essential expenses first: Direct funds towards your household bills, transport, and food before indulging in festive spending.
• Read and understand your credit agreement: Clarify all aspects of the agreement and ensure you fully comprehend the terms before signing.
• Protect your personal documents and banking information: A legitimate credit provider will never request to withhold your identity documents or banking details — walk away if they do.

"We encourage all South Africans to stay alert, protect themselves, and avoid the traps of illegal and informal lending," urges van Pletzen. "Borrow only when necessary, only what you can afford, and only from providers who operate within the legal framework." She reminds consumers that their financial wellbeing in January and beyond relies heavily on the decisions made during this festive period.

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