In the face of rising interest rates since November 2021, many South Africans find themselves grappling with debt and higher living costs. For nearly 2 million Nedbank clients, financial hardship has become a pressing reality.

The recently released NedFinHealth Monitor report reveals a concerning trend: South Africa’s average financial well-being scored 53 out of 100. Many South Africans are resorting to debt to offset the shrinking buying power of their disposable incomes. As debt escalates beyond manageable levels, a sense of financial shame takes hold, discouraging individuals from seeking the financial help they need.

We’re experiencing a crisis of economic uncertainty. People are worried about losing their homes, cars and financial stability. Fortunately, Nedbank is ready to offer help and guidance.

Common mistakes that compromise distressed clients

‘Many South African consumers do not have to endure the distress of losing their homes, cars and financial health amid a difficult economy,’ says Nozizwe Tshabuse, Nedbank’s Managing Executive for Client Debt Management and Recoveries. She notes that due to the perception of banks as profit-driven entities, people often shy away from approaching their bank when facing financial difficulties.

‘The consumer mindset needs to switch from one of fear that the bank is on standby to repossess assets to one of trust that the bank is open, empathetic, and already has solutions in place to help clients navigate difficult financial seasons without their financial dignity being compromised,’ she says.

Avoiding the problem through fear leads to several common mistakes, including:

• Putting things off and hoping for the best

If you’re delaying dealing with money troubles, hoping that future bonuses will sort everything out, you’re not alone. But waiting too long can affect your credit history.

• The ostrich effect

This is a reference to the myth that ostriches bury their heads in the sand. People do the same thing when we ignore messages, calls or bank statements that would force us to face unpleasant realities. This could lead to arrears piling up. Unfortunately, this also means missing out on different ways to get help.

• The committed payer

Feeling determined to pay even when things get tough? Many people do. But insisting that you’re not a defaulter, even when faced with bills you can’t pay, can make it harder to break free from money troubles.

Understanding and fixing these common mistakes can put you on the path to a more secure financial future.

Life-changing outcomes for Nedbank clients

For those who have contacted Nedbank for help since the post-Covid interest rate hikes began in 2021, the impact has been life-changing. Some of these transformative outcomes include:

• Customised repayment plans – Nedbank offers clients personalised repayment plans designed to recover outstanding payments over a specific period.
• Contract restructuring – Contracts are restructured to accommodate more affordable instalments spread over an extended time frame.
• Downsizing and selling assistance – Nedbank helps clients downsize or sell their cars and homes on the open market, ensuring transactions occur at fair market prices rather than distressed-sale values.

Engaging with your bank during financial challenges can bring about positive changes. This proactive approach minimises negative consequences, preserves your credit score, and provides access to financial resources for effective money management. By contacting the bank early, you can prevent unnecessary legal action, safeguard your credit score, and make well-informed financial decisions.

As we navigate through these challenging times together, remember that Nedbank is here to help you well before debt becomes unmanageable. Your financial well-being is our priority. Over the past 2 years, our interventions have yielded remarkable outcomes, positively impacting the lives of our clients.

Since 2021, Nedbank has successfully rehabilitated 1.8 million clients, enabled 82,000 to retain their vehicles, and helped 9,000 to keep their homes. Moreover, we have helped more than 25,000 clients sell their cars or homes to relieve debt pressure.

If you find yourself needing assistance or contemplating restructuring your debt, don't hesitate to ask for help. Speak to our experts, who are ready to guide you through tailored solutions. Contact Nedbank online or on 0801114949. Your financial journey matters to us, and we’re here to help you every step of the way.