Managing your money better: CASA’s guide to responsible credit use

The Credit Association of South Africa (CASA) has encouraged consumers to be mindful of their credit choices.

During a time filled with gifting, travel, and holiday expenses, CASA emphasises the importance of responsible borrowing, urging individuals to only engage with credit providers registered with the National Credit Regulator (NCR).

“This time of year typically places additional strain on household budgets. Factors such as gifting, travel, social events, January ‘back-to-school’ costs and family commitments can tempt consumers to take on debt they cannot afford,” said Leonie van Pletzen, the CASA’s chief executive.

She advised that hasty financial decisions made during this exuberant season often lead to severe financial pressures as the new year approaches.

“Credit can be a helpful tool, but only if used responsibly through registered providers who comply with the law and prioritise the protection of consumers. Informal or illegal lending continues to target vulnerable households over this period, making awareness and responsible decision-making crucial.”

To assist South Africans in navigating the financial opportunities and pitfalls this festive season, Ms van Pletzen shares seven expert tips focused on protecting financial well-being:

• Set a realistic festive-season budget: Plan for all expected expenses, including gifts, food, travel, entertainment, fuel, school fees, and January essentials. Only spend what you can genuinely afford.
• Only borrow if you can afford to repay it: Calculate your monthly repayment and ensure it fits comfortably in your budget after covering essential living costs.
• Borrow only from NCR-registered credit providers: Ensure your safety by confirming the NCR registration of your provider. Always ask for their NCRCP number and verify it with the NCR.
• Use your bonus or 13th cheque wisely: Instead of spending it all immediately, consider using it to pay off existing debts, boost savings, or prepare for January expenses.
• Prioritise essential expenses: Focus on household bills, school fees, transport, and food budget before festive spending to alleviate financial pressure in the new year.
• Read and understand your credit agreement: Never sign what you don't fully comprehend. Ensure clarity on interest rates, fees, repayment dates, and penalties for late payments.
• Protect your personal documents: A legitimate credit provider will never ask for your ID, bank card, PIN, or SASSA card. If they do, walk away immediately—it’s illegal.

As the festive season unfolds, Ms van Pletzen encouraged all South Africans to remain vigilant.

“Stay alert, protect yourselves, and avoid the traps of illegal and informal lending. Borrow only when necessary, only what you can afford, and only from providers who operate within the legal framework.”

“Your financial well-being in January and beyond depends on the decisions you make now,” she said, stressing the importance of informed and prudent financial choices as we approach the start of a new year.