South Africans earning more than R50,000 a month are facing mounting financial pressure, with debt repayments now exceeding their monthly income, according to DebtBusters’ second-quarter Debt Index for 2026.
The latest index shows that consumers in this income bracket require an average of 103% of their monthly income to service their debt, meaning their repayments are higher than what they earn.
DebtBusters executive head Benay Sager says the figures point to a growing divide between higher- and lower-income consumers.
The Debt Index tracks people who apply for debt counselling, examining their income, debt levels, types of credit and number of accounts.
Sager says lending to higher-income consumers has increased significantly since the Covid-19 pandemic, as financial institutions viewed them as lower-risk borrowers with stronger repayment prospects.
However, the increased access to credit appears to have contributed to growing debt levels among higher earners.
Sager says lending to lower-income groups had already begun declining around 2017 and 2018, with the trend becoming more pronounced following the pandemic. Some of this lending was subsequently replaced by increased lending to higher-income consumers.
Lower-income households squeezed by inflation
While lower-income consumers have seen their overall debt burden decline, Sager says this does not necessarily mean they are financially better off.
He says consumers at the lower end of the income scale are increasingly struggling with the rising cost of living, particularly food inflation.
People earning between R10,000 and R20,000 a month are facing particularly severe pressure, with Sager describing this group as the backbone of South Africa’s working population.
Rising food prices have consumed a larger portion of their disposable income, leaving households with less money to cover other essential expenses.
Consumers earning less than R10,000 a month are also facing reduced access to formal credit.
Recent figures from the National Credit Regulator indicate that about 65% to 66% of loan applications were being rejected by the end of the first quarter of 2026, with lower-income consumers accounting for a significant share of the declined applications.
Sager warns that limited access to formal credit could drive some financially strained consumers towards informal lenders, where interest rates can be substantially higher.
He says borrowing through the informal sector can result in interest rates of 50% or even 100%, compared with rates offered by formal financial institutions.
Debt remains a concern across income groups
DebtBusters’ data shows that the lowest-income consumers are using about 64% of their take-home pay to service debt.
Sager says a debt repayment ratio above 30% is generally considered unsustainable, putting the lowest-income group at more than double that threshold.
Despite the concerning figures, Sager says there is one positive development: younger consumers appear to be seeking assistance with their finances earlier.
He says consumers under the age of 30 generally carry significantly lower debt levels than those over 30, and seeking help earlier could prevent financial difficulties from becoming more severe later in life.