Low-Income South Africans Owe Up To 8 Times What They Earn

South Africans Face Rising Debt As Cost Of Living Outpaces Income

18 March 2026 — Low-income South Africans are increasingly relying on debt to survive, with some consumers now owing up to eight times their monthly income. New data from National Debt Advisors reveals a growing disconnect between earnings and the cost of living, highlighting deep financial strain across income groups.

Based on insights from more than 70,000 consumers under debt review, the latest Consumer Report shows that the average debt per consumer stands at R91,126, while the median monthly income is just R9,536.

Debt Levels Climb Across Income Groups

The data points to significant pressure across the board. Consumers earning between R5,000 and R10,000 per month owe nearly eight times their income. Among higher earners, the situation is even more pronounced, with those earning between R30,000 and R50,000 carrying debt levels exceeding 28 times their income.

Sebastien Alexanderson, Head of National Debt Advisors, says this reflects a structural issue rather than poor financial behaviour.

“South Africans are not living beyond their means anymore. Their means are simply not enough to live on. Debt has become the way people are closing that gap,” he explains.

Economic Pressures Intensify Financial Strain

Several economic factors are compounding the problem. Interest rates remain elevated, with the repo rate at around 6.5% and prime close to 10%, making borrowing more expensive.

At the same time, a weaker rand is driving up the cost of essentials such as fuel and food. Despite signs of easing inflation, households continue to feel the impact of rising living costs.

Economic growth remains subdued at approximately 1%, while unemployment sits near 32%, limiting income growth and job opportunities.

Heavy Reliance On Unsecured Credit

A key concern highlighted in the report is the growing dependence on unsecured debt. Among lower-income earners, 96% of debt consists of personal loans, credit cards, and store accounts.

Very few consumers hold assets that could provide financial security. Only 1.4% have home loans, and fewer than 5% have vehicle finance.

“This leaves people highly exposed,” says Alexanderson. “There is no asset to fall back on, and when interest rates remain high, repayments can quickly become unmanageable.”

Working South Africans Under Pressure

The impact is not limited to the most vulnerable. More than half of those seeking assistance are between the ages of 31 and 45 — individuals in their prime working years.

Over-indebtedness exceeds 50% among lower-income groups and remains above 40% even for higher earners. Increased access to credit among higher-income individuals is contributing to rising financial risk.

A Growing Structural Challenge

According to Alexanderson, the data reflects a broader economic imbalance.

“This is not about people making poor choices. It is a structural gap between income and the real cost of living,” he says. “Credit is filling that gap, but it is not solving the problem.”

With high interest rates, slow economic growth, and ongoing cost pressures, many households are finding it increasingly difficult to break out of the cycle.

For a growing number of South Africans, debt is no longer occasional — it has become a necessary part of everyday survival.

About National Debt Advisors

National Debt Advisors is a leading South African debt counselling company, helping consumers manage their finances and work toward becoming debt-free. The organisation negotiates with creditors to reduce interest rates and consolidate repayments into more manageable monthly instalments, while protecting clients from creditor harassment and asset repossession.