Staff Writer @ Lucid Living
Civil judgements recorded for debt fell 16.2% year-on-year to 42 018 cases in January, according to data released by Statistics South Africa (StatsSA) on Thursday. This was the sixth month showing a decline.
“The general trend is that of improving ability to service debt, which bodes well for the recovery and possible employment growth,” said Kgotso Radira, economist at Investec Group Economics, in a statement.
“While the civil judgments data is showing a downward trend, the amount of debt held by individuals is still quite large, amounting to R423.1m ” Radira said.
The largest contributors were money lent, with R146.5m; R99.1m for services; and goods sold at R62.5m
According to Radira, “debt restructuring could also be a contributing factor to the decline in civil judgments and not necessarily that financial positions are improving.”
An increasing number of consumers, through debt counseling, are negotiating longer repayment terms with their creditors. This has the effect of preventing the creditor from securing a civil judgment against the consumer.