Paycheques gutted by debt, particularly among high earners

It will come as no surprise to South Africans that their expenses over the past decade have far outstripped their income growth. However, seeing it reflected in the figures it quite startling. Debt counselling and management company DebtBusters released its Debt Index for Q4 2025 yesterday, showing that electricity tariffs have increased by 165%, petrol prices by 74%, and the compounded impact of inflation (CPI) has been 49% over 10 years.

While consumers’ financial confidence may have improved in 2025, their debt levels have also risen significantly. According to Benay Sager, executive head of DebtBusters, the level of take-home pay devoted to debt servicing is at its highest in almost a decade. Consumers who applied for debt counselling in the fourth quarter of 2025 needed 71% of their take-home pay to service their debt.

“A record 96% of these consumers had a personal loan, and 59% had a one-month (payday) loan – another record,” he said during a virtual briefing. “This indicates that personal loans, especially one-month loans, continue to be a vital lifeline as consumers supplement their income with short-term unsecured credit.” He added that a worrying trend is the significant increase in the debt burden among high-income earners. Unsecured debt among those earning more than R35 000 a month is 75% higher than in 2016, vastly outpacing inflation and net income growth.

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Sager says this level of unsecured debt is unsustainable. These figures underscore the sentiment that individual taxpayers cannot take on further tax increases. Finance Minister Enoch Godongwana and government got a taste of that when they tried to increase the value-added tax (VAT) rate from 15% to 17% during last year’s budget fiasco.

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