Time of the Signs: About life and debt

2013-04-14 14:00

Growing up, there were few things that elicited more excitement and curiosity in the rural neighbourhood than the arrival of a furniture-store van to deliver goods.

Usually, it was a Town Talk or Ellerines van and, in the moment you saw its bright yellow colours, you felt like something good and uplifting was being bestowed on the family.

But that was then, before I understood that what the truck was really delivering was a stiff yoke of credit.

For many young black people, buying your first piece of furniture was usually the first really visible and tangible evidence of your new financial status as a working person.

Culturally, one of the first “must haves” came to be the bedroom suite (headboard, dressing table, base/mattress set) and a wardrobe. Somewhere along the line, a fancy catalogue linen to match became a part of the package, for women at least.

Opening a credit account, followed by the delivery of the bedroom items (later to be followed by a lounge suite and kitchen set) at one of South Africa’s major furniture stores, became almost akin to a rite of passage that affirmed one’s entry into adulthood.

But once the adult had a place to sleep, what on Earth would he or she wear? Thus followed the clothing-store account which, of all the consumer-credit acquisitions, was the one that carried the highest status.

Let’s not be in denial, back then we were always so proud of having mothers with an Edgars card.

What is evident is consumption and access to credit have become so much a part of black life, it is now part of our modern identity.

At a practical level, credit helps us manage cash flow while acquiring costly items, and it enables us to participate in urban social culture.

It should be obvious some of these things – headboards and dressing tables (fluffy chair and all) – are not necessities. They have little function. But many have been persuaded that their bedrooms are not complete without them. Credit is availed so we can become “modern adults” by decorating our homes with these things.

As we are all too aware, debt causes daily misery and hardship for South Africans. Those same vans that deliver new furniture and a sense of pride and accomplishment to households are the very same ones that take it away, wrapped in grey blankets, when furniture is repossessed.

The situation of izikweleti (debt) is so dire in the black community that some of the richest people in the community are the feared omashonisa (loan sharks).

But the issue of informal credit is for another day. The lenders in the formal economy drive indebtedness.

What South Africans cannot see is that furniture stores are not really selling furniture, but are selling us debt to finance our fantasies.

Is it any surprise that African Bank, which is known for its unsecured loans and steep interest repayments, also owns Ellerines, the furniture-retail brand so entrenched in black consumer culture?

I find it ironic that the core business of the one commercial bank named “African” is to enable deeper dependence on debt to finance consumption, rather than, say, reconstruction. Call me an idealist.

What is frightening is that when all the costs of the services and insurance charges are calculated, someone could find themselves paying almost quadruple the advertised price.

According to Moneyweb, a customer could end up paying R26?944 in total, over 36?months, for something that was advertised for R8?699.

Last year, the National Credit Regulator (NCR) reportedly found that 50% of consumers are in arrears to the extent of being at least three months behind in payments.

The NCR also tells us the problem of indebtedness cuts across all social and class lines.

But these frightening statistics remind us that, for South Africans, many of whom do not earn much at all, debt finances dreams and symbols of adult success and we will pursue these dreams, even if it yokes us.

»?Mkhize is a sangoma

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