Borrowers are in trouble but lenders are staying away from the courts in their efforts to recover bad debts, data released by Statistics SA yesterday shows.
From December to February, the number of summonses for debts fell 11.3 percent while the number of judgments dropped 10.3 percent. The value of debts for which judgments were granted fell 2.4 percent.
According to Stats SA, there were 60 920 civil judgments for debt in February worth R560.7 million. The largest portion of this was judgments relating to money lent and promissory notes and other acknowledgments of debt, which include credit cards.
According to Econometrix, individuals account for nearly 90 percent of all summonses and judgments.
While the numbers might seem benign, they did not point to an easing off of pressure on borrowers, economists warned.
Nedbank's chief economist, Dennis Dykes, said the falling number of summonses and judgments was due to fear that an overzealous approach to debt collection would cause more problems than it would solve, and the long wait for a judgment to be finalised.
full story from Business Report here