Do not use your credit for #BlackFriday - Credit Ombud
Salem Nyati, the head of communications at the Credit Ombud, said consumers needed to be wise about spending on Black Friday.
“If you have to buy it on credit it means you cannot afford it. With so many deals available on Black Friday, it is important for consumers to know exactly what they want to purchase and how much they are prepared to spend. Have a plan, have a budget and stick to it.”
Black Friday comes against the backdrop of a technical recession, low employment growth, tax rate increases and record-high fuel prices, which have contributed to highly constrained consumer finances.
Consumers are expecting to search for bargains on large-ticket items such as smartphones and TV sets as retailers have slashed prices and sweetened the sale with incentives including free delivery and cash back.
However, the National Credit Regulator (NCR), has found that four of 10 credit-active consumers are in poor standing, with accounts three or more months in arrears.
At the same time, household consumption expenditure growth contracted for the first time in two years during the second quarter of this year.
The PwC expects retailers’ sales promotions as part of Black Friday may bolster consumer spending in the last quarter of the year. Black Friday originated from the US and falls a day after Thanksgiving.
It is regarded as the first day of the Christmas shopping season in that country and has gained traction in South Africa over the past four years with retailers cashing in on high sales.
Black Friday is a cash cow for local retailers with BankservAfrica, the continent’s largest automated payments clearing house, recording R2.5billion worth of transactions last year. Facebook data indicates that Black Friday is the busiest online shopping day in South Africa.
Market and consumer information company GfK South Africa again expects good growth in Black Friday retail sales this year.