Urban Working Class Credit Usage and Over-Indebtedness in South Africa

South Africa's political transition has resulted in an increase in the ability of a larger proportion of South African households to borrow. The reasons for this are partially market driven (i.e. recent increases in household wealth for the new middle classes, wealth redistribution, declining interest rates, improved risk management approaches and the pursuit of new markets on the part of financial institutions) and partially politically and legislatively driven (i.e. encouraged by changes to the regulatory and policy environment, encouraged 'financial sector deepining', and wider acces to the formal financial sector).Growth in credit consumption in south Africa, however, hs exceeded growth in incomes, leading to increasing levels of household debt. One of the groups most affected by these changes is the urban working class and this article explores some of the features of, and reasons for, their over- indebtedness through industry specialist interviews, primary fieldwork and credit bureau data analysis of a sample of urban working class breadwinners and presents this within the changing socio-economic context of post-apartheid South Africa.