Higher-Income South Africans Increasingly Defaulting on Debt

• New data shows South Africans earning over R180,000 a year are accessing more credit but increasingly falling behind on repayments
• The latest Credit Stress Report warned that defaults and overdue balances were rising across income groups, signalling growing financial pressure
• The Business Tech report showed more consumers falling into arrears as overdue balances climbed to R224 billion

South Africans across multiple income groups are showing growing signs of financial strain, even as access to credit continues to expand. New findings suggest that rising borrowing levels are now being matched by a troubling increase in missed repayments and overdue debt.

According to BusinessTech, new data shows that South Africans earning more than R180,000 a year are taking on more credit but are increasingly falling behind on repayments, raising concerns about the sustainability of household debt levels. The findings come from Eighty20’s latest Credit Stress Report, which highlighted a rise in over-indebtedness during the fourth quarter of 2025. The report shows that while credit uptake continues to grow, repayment behaviour is deteriorating across several income segments.

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However, the share of consumers falling behind on their repayments also rose. The report found that around 40% of credit-active South Africans are now in default, defined as being at least three months behind on one or more loans. During the quarter, this group opened around 233,000 new loans, representing a 35% annual increase. Personal loans accounted for around 70% of new borrowing among retirees, suggesting that many older consumers are using credit to cover everyday living expenses rather than long-term investments.

High earners borrowing more, struggling later

The value of overdue debt also grew sharply. Overdue balances rose by R12 billion during the quarter, a 6% increase, bringing the total to R224 billion. This marks an increase of more than 12% compared with the previous year and represents about 8.4% of total outstanding debt. These individuals represent the top 5% of earners, with average personal incomes of around R42,000 per month, although the range extends from about R30,000 to more than R120,000. The number of credit-active consumers in this group grew by 7% over the past year to reach 2.3 million individuals.

Across all income groups, a large portion of monthly income is now being directed toward debt repayments. The report found that credit-active South Africans spent an average of 29% of their net income servicing debt in the fourth quarter. The burden is even heavier for higher-income earners. Heavy hitters spend nearly 48% of their income on instalments, while middle-class workers allocate about 37%.According to the report, these trends highlight growing financial strain among South African households as borrowing increases and repayment pressure intensifies.

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3 Other Briefly News stories about debt

• Cape Town-based musician Miché van der Rheede is hoping to graduate this year, but her student debt is an obstacle in her journey.
• Bonang Matheba allegedly owes millions in unpaid taxes to the South African Revenue Service (SARS), after being issues a notice in February 2026.
• The City of Tshwane has once again disconnected electricity at Thami Ndlala Mall and Hotel Apartments after the property was found to have been illegally reconnected despite owing over R600,000.

Source: Briefly News