FNB has warned that South Africa’s middle-income consumers on average spend almost their whole salary in five days after payday.
Reserach from FNB today showed that middle-income consumers earning between R180 000 – R500 000 per annum survive on 20% of their monthly salary for about 25 more days in a month.
Moreover, FNB said 30% of middle-income consumers was spent on unsecured credit and 35% on secured credit.
FNB Retail chief executive Raj Makanjee said this damning finding highlighted how the average consumer gets financially strained and is restricted from broaden their income to investment streams.
“The trend also points to a continued culture of consumption, leaving consumers with little to start saving and investing for financial independence,” Makanjee said.
FNB said it has attempted to minimise the financial stretch most of its clients occur monthly, by implementing platform-based tools which assist with better money management.
Makanjee said both nav>> Money and eBucks Rewards programmes have provided pay-outs of over R16 billion in the past 20 years.
He said the bank’s efforts to provide integrated financial services through various channels was in efforts to “helping them to unlock financial capacity in their lending and transactional activities to be able to save, invest and protect themselves and their families.”
Their aim to securing the middle-income consumers a more stable financial future is rooted in their access to the financial advising they provide.
FNB Money Management chief executive Senzo Nsibande said the FNB Banking App for example, was free and eligible to be used with currently over 2 million active users.
Nsibande said that those who use the FNB App were more likely to improve their credit, honour debit orders and begin or increase their savings on hand.
“By evaluating all aspects of their finances, consumers can stretch every rand beyond its potential. This may allow them to begin accumulating cash savings for emergencies and better plan for lifelong decisions such as a comfortable retirement,” Nsibande said.
