Reckless lending is still common practice in SA

Borrowing money can be a very risky thing to do, especially in a recession when job security isn't always what it should be.

It is however still common practice for lenders to provide credit to people who are financially vulnerable.

Africa Melane spoke to Lesiba Mashapa, company secretary at the National Credit Regulator about the pressures of rising costs on cash-strapped consumers.

READ: Improvement in how credit being managed in tough economic times

Mashapa says while regulation is in place, consumers should be cautious of their credit uptake.

We now have legislation which is supported by regulations which impose stricter affordability assessment requirements firstly for lenders, but also consumers have responsibility to borrow responsibly.

Lesiba Mashapa, company secretary at the National Credit Regulator

We believe that the lenders should be responsible by not extending credit to people who are already stretched.

Lesiba Mashapa, company secretary at the National Credit Regulator

We have the mandate to enforce regulations and penalise lenders who are not lending responsibly, but at the same time the legislation can only work if all the role players that are involved, consumers and lenders play their part.

Lesiba Mashapa, company secretary at the National Credit Regulator

Click on the link below to listen to the full audio....

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