Turbulent times expected for Namibian consumers – Survey
A new survey, presented at the inaugural Financial Services Summit in Windhoek on Tuesday revealed a challenging financial outlook for local consumers.
According to a TransUnion study, 45% of Namibians reported that they will be unable to pay their current bills and loans in full.
TransUnion is a global information and insights company with over 12,000 associates operating in more than 30 countries, including Namibia.
“Many consumers have been forced to adjust their household budgets in response to these challenges, with 56% cutting back on discretionary spending, such as dining out, travel, and entertainment, over the past three months,” said Lara Burger, country manager at TransUnion Namibia.
According to TransUnion’s quarter 3 Consumer Pulse Study, one of the significant factors contributing to the decrease in household income was job loss, with 27% of consumers reporting that someone in their household lost their job over the past month.
Other factors impacting decreased income included wage or salary reductions (16%) and owning a small business that closed, or saw orders dry up, the study noted.
The survey also highlighted a low percentage who think they have access to credit and potentially a lack of consumer confidence in the credit market. Nearly all consumers (93%) believed access to credit and lending products is important to achieve their financial goals. However, just over a third (34%) felt they had sufficient access to credit, and 35% intended to apply for new credit or refinance within the next year.
Looking ahead, Burger said consumers are bracing for further financial strain.
“A significant 38% of consumers in TransUnion’s survey expected to increase spending on bills and loans over the next three months, while 33% expected to decrease their in-store and online retail shopping (e.g., clothing, electronics and durable goods),” she said, adding that 48% planned to make cuts to their discretionary spending in the next three months, and 28% expected a decrease in large purchases such as appliances and cars.
According to Namibia’s Statistics Agency, the country’s inflation rate rose to 4.7% in August, going up from a near one-and-a-half-year low of 4.5% in July 2023.