South African credit growth strongest since 2009
· The South African
South African private sector credit extension (PSCE) growth was the strongest since February 2009. PSCE growth accelerated to 10.5% year-on-year in February from 8.83% year-on-year in January.
PSCE Feb 2026 jpg is from data provided by the South African Reserve BankThe South African Reserve Bank data shows that some of this growth was due to the volatile bills and investments category. This jumped by 33.9% in February after a 21.7% gain in January. The total loans and advances excluding bills and investments category saw growth of 8.76% in February from 7.76% in January.
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Household and corporate demand
Moreover, household credit demand accounts for 47.4% of total loans and advances. This category rose to a two-year high of 4.2% in February from 4.0% in January. All the subcategories, except overdrafts, expanded in February. Credit card usage drove the increase. It expanded by 5.6% year-on-year.
Personal loans only rose by 3.5% year-on-year. The largest single category, home loans, expanded by a small 3.0% year-on-year. This reflected the subdued residential property market.
On the other hand, corporate demand accelerated to more than four times the consumer inflation rate of 3.0%. Corporate demand growth was 13.2% in February from 11.4% in January.
General loans, which are the easiest to obtain, jumped to a 18.6% increase in February from a 15.6% gain in January. This category is used to finance capital spending.
Pre-Iran war confidence surveys
Both the business and consumer confidence surveys conducted by the Bureau for Economic Research (BER) in the first quarter 2026 showed an improvement. This was a probable reason for South African private sector credit extension growth being the strongest since February 2009.
The business confidence index (BCI) improved to 47 in the first quarter 2026 from 44 in the fourth quarter 2025. It was only 39 in the third quarter 2025.
The BCI now stands six points above its long-term average of 41. It is also a large 20 points above the post-COVID low reached in the third quarter 2023. If the post-Covid bounce of the second quarter 2021 to 50 is excluded, then the first quarter 2026 reading is the highest since 2015.
Additionally, the consumer confidence index rose to -7 in the first quarter 2026 from -9 in the fourth quarter 2025. It was only -13 in the third quarter 2025.
The confidence levels of high-income households drove the rise in the first quarter 2026. This group earns more than R20 000 per month. The index for this income group rose to -4 in the first quarter from -12 in the fourth quarter. There were improvements in all three sub-indices for high-income consumers.
Notably, the substantial improvement to 14 from 4 in the outlook for their household finances was remarkable. This is now at the highest level since the pre-pandemic second quarter 2019.
Unfortunately, high-income consumers were the only income group that registered an improvement in their rating of the present time to buy durable goods.