Consumers under severe pressure and debt, says bank

GEORGE NEWS - The George Business Chamber's June networking evening, hosted by FNB at the Hawthorn Hotel on Thursday 26 June, saw a big turnout despite the cold weather.

Welcoming the crowd, FNB Eastern and Southern Cape regional manager Graeme Cole expanded a little on the brand, saying that they have the largest market share of commercial clients in the South African banking sector, something they have had to work very hard at to retain.

He also shared some insights into the current market as gained from their balance sheet, and said the retail segment (the consumer or salaried individual) is under severe pressure and 'massively indebted'.

The numbers roughly considered indicate that almost every single person in the country in this segment has personal debt of about R100 000 to R200 000.

"Considering that many South Africans do not have the ability to have anywhere near that level of debt, it shows how much debt is spread among those in a position to obtain it."

The bank is seeing the exact opposite in its business balance sheet. Businesses are buckling their belts as tight as they can, a reflection of uncertainty and tough economic times.

PHOTO GALLERY: FNB hosts successful George Business Chamber networking evening

Jevon Theron (RWA Labour), Rikus Coetzee (Solve-Edge Solutions) and Nicola Greeff (Regus).

"Interest rates are still not coming down as quickly as we hoped, the world economies are in a bit of a mess right now, and we could well move back into an interest rate increase.

"People are really scared and are holding on to their cash, rather than investing in expansion."

This is affecting the bank's asset growth - or lending - which is very subdued and difficult.

Cole warned against banking fraud, saying that 99% of incidents starts with weak processes within a business - shared passwords, weak firewalls, poorly disciplined staff, and a lack of secure and sufficient processes.

Diane le Grange (Love to Create), Stella Pretorius (Yolk Printshop) and Vanessa Schreiber (Telkare).

Kidnapping is another concern, as there is a new trend in which normal business people - not just the ultra rich - are targeted. The ransom amounts are much lower and criminals much less sophisticated, and people should be vigilant.

Paul Hoffmann, one of the organisers of The Entrepreneur 2025 training and mentorship programme for local businesses, invited members to enter before 14 July.

This year's edition of the programme was recently launched, and it starts on 29 July. More information and entry forms are available at theentrepreneurgeorge.net.za.

Nellie Reimann (George Backpackers) and Nadia Harding (Pam Golding Properties).