No change expected in inflation for May

By Gordon Bell

Johannesburg – The country’s main inflation gauges probably stalled last month after a race higher in the previous two months, but credit growth may have edged back up towards record highs.

The annual increase in the key inflation measure, consumer price inflation less mortgage costs (CPIX), which is due on Wednesday, is expected to be steady at 6.3 percent year on year last month, according to a poll of 13 economists. More…

Millions of Americans give bank accounts a miss

By Jeannine Aversa

Washington – Grandma stuffing money under the mattress is not the only one living outside the banking system.

Between 10 million and 28 million people in the US are forgoing traditional financial institutions because of mistrust, cultural and language barriers, or a belief that by the time all the bills are paid, there will be nothing left for an account.

That can be expensive and risky. People can run up big fees to cash cheques and pay bills, as well as being targets for thieves.  More…

Visa shows books before going public

New York – Visa, the world’s largest credit card company, earned $465 million (R3 billion) last year, according to a regulatory filing that gave investors a first look at the company’s books ahead of a proposed initial public offering. More…

Week in review – June 24 2007

By Edwin Naidu

It comes as no surprise to hear this week that South African banks are charging local consumers more than double the world average in bank charges.

It was also no surprise that two of the big four – Standard and Absa – disagreed with the World Retail Banking Report 2007. First National Bank (FNB) and Nedbank are silent about the report.

The study found that local current account holders are paying R1 863 a year in fees while the global average is about R750. South African consumers are paying more for payment services than their counterparts in almost all other countries. More…

Black middle class defies easy definition

By Tonny Mafu

Johannesburg – Despite acknowledging the emergence of a black middle class, researchers still differ on the definition, size and economic factors behind the trend, raising questions about the existence of this group.

Carel van Aardt, a professor at Unisa’s Bureau of Market Research, said the definition of middle class was problematic.  More…

Emerging wealthy segment shines up consumer spend

Black diamonds – the well-to-do black middle-class group – account for 28 percent of total consumer spending in South Africa, according to research from the UCT Unilever Institute (UCTUI) and TNS Research Surveys .

Included in the segment are individuals who are wealthy, educated and have high-paying jobs, and youths from well-to-do black families.

The study, based on interviews of 4 500 black diamonds across seven major metropolitan areas, finds that the average monthly income for this group was R6 100 at the beginning of this year, from R5 900 in 2005. More…

SA has 12 000 debt collectors

South Africa has 12 000 active, registered debt collectors, the Council for Debt Collectors revealed in Pretoria on Thursday.

“The past year alone, almost 3 000 applications were approved. This represents a 16 percent increase on the previous year,” council chairperson Jasper Noeth said at a public information session.

He said the registrations were made under the Debt Collectors’ Act which had transformed the industry since it had come into operation four years ago. More…

Bank will keep tightening policy grip, says economist

By Ethel Hazelhurst

Johannesburg – Domestic interest rates had been too low for too long and the delay in hiking rates had encouraged more people to get too deep into debt, Chris Harmse, the chief economist at Dynamic Wealth, said in a presentation yesterday.

Harmse, a former University of Pretoria professor of economics, predicted that interest rates could rise further, by as much as 2 percentage points over the next 18 months. More…

Corporate demand spurs credit growth

By Ethel Hazelhurst

Johannesburg – Credit demand from individuals continues to slow, while demand from non-individuals is keeping total credit growth high, according to Nico Kelder, an economist at the Efficient Group.

The discrepancy is striking in the case of mortgage loans.

Total growth in mortgage credit in the 12 months to April was nearly 28 percent to R723 billion. Meanwhile, credit extended to non-individuals, a category that includes companies, some trusts, close corporations and public enterprises, grew 54 percent to R209 billion. More…

Dark side of Indian call centre success

By Andy Mukherjee

Shyam Mehra (26) is a self-professed loser in New Delhi. When he dons a phone headset each night, though, he becomes a polite troubleshooter for Americans angered by home appliances.

So goes One Night @ the Call Center, a novel by Chetan Bhagat.

More than 400 000 people work in Indian call centres. A customer service job is an easy route to $300 (R2 200) a month and a three-pizzas-a-week lifestyle.

But many young agents loathe the surveillance, which would put a high-security prison to shame. Some can’t get used to abusive customers; others fail to adjust to working at night.’ More…