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JOHANNESBURG Aug 30 (Reuters) – The recent surge in
unsecured lending in South Africa is a concern, particularly
among lower-income consumers, the head of FirstRand Ltd
said on Thursday.
“There has to be concern about the level of growth,
particularly in the mass market,” Sizwe Nxasana, the chief
executive of the country’s second-largest bank, said at an
investment conference.
Banks in Africa’s top economy have been pushing into the
lucrative unsecured loan market, which relies solely on the
customer’s promise to pay back debt, to offset weak corporate
demand for credit.
However, household debt stands at a dangerously high level of
70 percent of disposable income, and the central bank fears that
may get worse as banks expand into the sector.
(Reporting by David Dolan and Tiisetso Motsoeneng; Editing by
Jon Herskovitz)
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