The debt stress level among South African businesses improved in the second quarter of 2013, according to the latest KreditMetrix report, published by Experian SA and Econometrix on a quarterly basis.

 

 

Decline in overall debt stress for business is encouraging

South Africa, 02 September 2013 – The debt stress level among South African businesses improved  in the second quarter of 2013, according to the latest KreditMetrix report, published by Experian SA and Econometrix on a quarterly basis.

Average debtor’s days for businesses in South Africa fell from 48.7 days in the first quarter to 48.1 days in the second quarter.  This also represents -6.4% decline year-on-year.

There was also a reversal in the growth trend in the debt age ratio – the ratio of debt owed for more than 90 days as a percentage of debt owed less than 60 days. After rising from 8.5 to 10.7 in the first quarter 2013, the debt age ratio fell back to 9.7 in the second 2013.

According to David Coleman, head of analytics at Experian SA, the rising trend in debt stress levels that ensued since the second quarter of 2012 has changed course and is now more in line with the overarching downward trajectory that began in the third quarter of 2008, which was prompted by the sharp reduction in the repo (policy) interest rate.

“The improving global economic growth prognosis, especially with macroeconomic data coming out of the Eurozone pointing to signs of renewed growth, should impact positively onto domestic economic growth momentum,” said Coleman.

“In turn, this should sustain the declining trend in domestic business to business debt stress indicators. Furthermore, improving growth momentum in advanced economies, including all of the US, Japan and Eurozone, is likely to impact positively on domestic industrial activity levels as external manufactured and primary product demand recuperates,” he said.

While the improved global economic prognosis will garner further support for commodity prices in the shorter to medium term, the extent to which this will translate into positive growth for the mining sector is made uncertain by the persistent operational risks within the sector.

Overall, while it can be expected that improving global economic momentum would impact positively onto domestic economic growth, this is likely to be held back to some extent by the mining and electricity sectors in the shorter term. Undoubtedly, this will weigh on overall economic growth momentum. While business debt distress levels should continue to moderate going into Q3 2013, this process is likely to remain gradual.

 

ENDS

Prepared by Meropa Communications on behalf of Experian SA

Contact:

 

Taryn Stanojevic

Experian South Africa (Pty) Ltd

+27 11 799 3434

Taryn.Stanojevic@experian.co.za

 

Jonathan Mahapa

Meropa Communications

+27 11 506-7333

JonathanM@meropa.co.za

 

 

About Experian

Experian is the leading global information services company, providing data and analytical tools to clients around the world. The Group helps businesses to manage credit risk, prevent fraud, target marketing offers and automate decision making. Experian also helps individuals to check their credit report and credit score, and protect against identity theft.

Experian plc. is listed on the London Stock Exchange (EXPN) and is a constituent of the FTSE 100 index. Total revenue for the year ended 31 March 2013 was US$4.7 billion. Experian employs approximately 17,000 people in 40 countries and has its corporate headquarters in Dublin, Ireland, with operational headquarters in Nottingham, UK; California, US; and São Paulo, Brazil.


For more information, visit http://www.experianplc.com.

 

 

 

 

 

Experian.co.za

News release

 

Businesses’ debt stress level increase

South Africa, 08 April 2013 – South African businesses experienced growing debt stress levels in the fourth quarter of 2012, according to the KreditMetrix report published by Experian SA and Econometrix. The report is published on a quarterly basis.

 

Business debt stress indicators, both average debtors’ days, as well the debt age ratio – the ratio of debt owed for more than 90 days as a percentage of debt owed under 60 days – accelerated in the fourth quarter of 2012.

 

David Coleman, Head of Analytics at Experian SA said: “This reflects negative feedback from the wave of industrial action in the mining and manufacturing sectors over the third quarter of 2012 which weighed heavily on overall economic momentum and culminated in the rise in business balance sheet stress.”

 

“While economic growth momentum in the Eurozone is expected to remain depressed throughout the year, which will weigh on South Africa’s own economic performance somewhat, this could be counteracted by strengthening trade ties with China. This country is key export market for South Africa’s mineral exports and South Africa has been identified as strategic partner in Africa by China,” said Coleman.

 

Average debtor’s days for businesses in South Africa rose from 46.1 days in the third quarter to 47.5 days in the fourth quarter. The debt age ratio showed an increase based on the fact that debt owed in the 90-120 days and 120-plus days categories showed a relatively sharp increase in year-on-year growth in the fourth quarter, while growth in debt owed in the categories less than 90 days slowed down. In spite of the increase, both measures are still tracking below historical average levels.

 

An analysis of the data by sector in the fourth quarter 2012 reveals that the wholesale retail and trade sector accounted for the largest share of total debt owed by businesses to business with a 36.1% share – up from the 33.5% share in the third quarter 2012. This was followed by the transport sector at 13.1% in the fourth quarter 2012. The finance sector was third, with 9.98% of debt in the fourth quarter 2012.

 

The sector that recorded the highest debtor’s days in the quarter included the household, exterritorial sector at 74.0 days, followed by social and personal services sector at 59.1 days in the quarter. These sectors where impacted adversely by weaker business confidence levels in the fourth quarter 2012.

 

 

 

ENDS

Contact:

Jonathan Mahapa

Meropa Communications

+27 11 506-7333

JonathanM@meropa.co.za

 

About Experian

Experian is the leading global information services company, providing data and analytical tools to clients around the world. The Group helps businesses to manage credit risk, prevent fraud, target marketing offers and automate decision making. Experian also helps individuals to check their credit report and credit score, and protect against identity theft.

Experian plc is listed on the London Stock Exchange (EXPN) and is a constituent of the FTSE 100 index. Total revenue for the year ended 31 March 2012 was US$4.5 billion.

 

Experian employs approximately 17,000 people in 44 countries and has its corporate headquarters in Dublin, Ireland, with operational headquarters in Nottingham, UK; California, US; and São Paulo, Brazil.


For more information, visit http://www.experianplc.com.

 

 

 

 

News release

 

Widespread scam targets debt-strapped consumers

South Africa, 12 February 2013 – “Do not pay anything up front until you have had a service of some value.”

This is the earnest warning to all consumers from Sharon Coppola, legal risk and compliance executive at information services group Experian SA.

It is a cautionary message prompted by a scam that has cost beleaguered consumers many thousands of rands since it started doing the rounds in recent months.  Coppola also urges people to contact a credit bureau and get a free copy of their credit report to understand how they can manage their credit rating instead of falling prey to these scams.

Recounting the story of a victim who recently approached Experian for assistance, Coppola tells of a woman who desperately needed a second-hand car and advertised on public internet sites, in the process highlighting the difficulty she was encountering as a result of her poor credit rating.

She was then approached via email by someone who wrote that the same thing had happened to him; that he knew of an organisation that could help her; that he would arrange for her to receive a contact address.

Soon thereafter she was furnished with an internet email address, with which she engaged. Help was offered contingent upon her receiving a favourable credit record – which, the identity behind the email assured her, could be obtained upon payment to him of R3 000.

“Once I am able to secure a clean credit record for you, I can have your car ready and waiting.”

To illustrate its bona fides, the scam syndicate sent her a host of documentation liberally festooned with the logos of credit bureaus, the ombud, and a leading commercial bank.

“The forms were pseudo and the logos were reproduced from branded material readily available to the public,” says Coppola.

Once the R3 000 had been paid, the fraudsters closed their internet account and the account into which the money was paid. Unsurprisingly, the further impoverished consumer never heard from the perpetrators again.

She called Coppola to recount her dreadful experience.

“The saddest thing of all is that those who fall for the scam are those least able to afford the R3 000, since they cannot get credit anywhere else. In this particular case, the family lost their house. All they were trying to do was to get a cheap second-hand car in order to get around.

“We brought the scam to the attention of forensic investigators who said there was little they could do to track down the perpetrators because they hid behind a public website address. In effect, she lost R3 000 and she will never get it back.

“Alas, it is not the first time it has happened, and probably won’t be the last.”

As a service to the public, Experian is doing its level best to create awareness among consumers.

“Be warned; do not fall for this scam,” Coppola urges. “There are clever syndicates behind this carefully premeditated scam; syndicates that troll the web for debt-strapped consumers. Do not pay anything up front until you have had a service of some value.”

She emphasises the consumer’s right to go to a credit bureau before resorting to desperate measures and confirms that credit bureau does not remove information unless, after investigation, there is a legitimate reason for removal.

“A credit bureau like Experian is able to examine a credit rating and advise on how it can be managed, and where possible, improved. As a starting point, simply approach a bureau and request a free credit report. You can challenge the information contained in the report and could arrange for certain of the data to be excised.

“In short, make the bureau your first point of call.”

 

Footnote

To access your Experian credit report online and sign-up to receive credit report updates by sms and email, please visit www.creditexpert.co.za. For queries on your Experian credit report please contact Experian Consumer Relations on 0861 10 56 65.

ENDS

 

Contact:

Natasha Horwitz

Experian South Africa

011 799 3400

Natasha.Horwitz@experian.co.za

 

Jonathan Mahapa

Meropa Communications

+27 11 506-7333

JonathanM@meropa.co.za

 

About Experian

Experian is the leading global information services company, providing data and analytical tools to clients around the world. The Group helps businesses to manage credit risk, prevent fraud, target marketing offers and automate decision making. Experian also helps individuals to check their credit report and credit score, and protect against identity theft.

Experian plc is listed on the London Stock Exchange (EXPN) and is a constituent of the FTSE 100 index. Total revenue for the year ended 31 March 2012 was US$4.5 billion. Experian employs approximately 17,000 people in 44 countries and has its corporate headquarters in Dublin, Ireland, with operational headquarters in Nottingham, UK; California, US; and São Paulo, Brazil.


For more information, visit
http://www.experianplc.com.

 

 

                                                            

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