HIGH levels of indebtedness among Namibians are worrying financial regulatory authorities including the
Yesterday, Namfisa CEO,
Shiimi said consumers must to live within their means and avoid unnecessary stress caused by high levels of debt.
In its latest Monetary Policy Statement, the
"The rise in household credit largely reflected strong growth in installment credit and overdraft loans. Furthermore, loan disbursements by microlenders for the calendar year ending
With this situation in mind, Shiimi encouraged Namibians to live within their means so as not to fall into the debt trap.
He said when people borrow money from financial institutions, including microlenders, they must at least use this money for productive purposes such as investing in assets that will yield results that are beneficial to the Namibian economy and individuals' financial positions.
Annual inflation, according to the bank, rose from 4,9% in
"With inflation on an upward trend, consumers are encouraged to create sufficient savings to serve as a buffer to fend off the effect of expected higher prices and rising interest rates. This will avoid them getting deeper into a debt trap. This will also prevent premature termination of insurance policies and cashing in on pension/retirement savings," Shiimi said.
He said despite the fact that the cost of living in
The limited resources available in
"Consumers should not rely heavily on debt but they should also be prepared to save money to be used when it is necessary, that is at the time when they will no longer be able to generate their own income or sufficient income for that matter.
"Namfisa thus encourages borrowing for investments and self-sustainability purposes, " he said.
Shiimi has also called on civil society and mass-based organisations to educate their members and stakeholders about the need to cut down on their lifestyle expenses.
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