South Africa’s youth are borrowing more to survive rising living costs, but experts warn that limited income and high unemployment are creating a fragile financial future.
As South Africa marks Youth Day this month, new research paints a sobering picture of the economic reality confronting millions of young people, with high unemployment, constrained incomes and mounting credit pressure shaping the financial future of an entire generation.
According to the latest Credit Stress Report by consumer strategy and analytics business Eighty20, South Africans under the age of 24 account for about 43% of the country's population, yet represent less than 2% of active credit users by number and under 0.5% by value.
While their current footprint in the credit market remains relatively small, analysts believe they will determine the future of South Africa’s financial sector.
“For businesses, this cohort presents a paradox: negligible right now, but disproportionately important for the future. The FSPs who successfully engage them early stand to gain a lifetime of customer value,” Eighty20 said.
