CHRIS GILMOUR: Clothing retailers put out strong updates as credit sales grow
Various leading listed stores are quite happy that they are not advancing new credit recklessly, as their credit rejection rates remain high
A number of listed SA clothing retailers have released trading updates in recent days that included the all-important Christmas trading period. Not only are all of these updates surprisingly strong but, with the exception of TFG and Woolworths, all point to enhanced use of credit by customers in their stores.
These retailers are obviously happy that they are not advancing new credit recklessly, as their credit rejection rates remain high. That observation is endorsed by the National Credit Regulator’s latest statistics for third quarter 2022 which shows a rise in rejection rates for new credit applications. As interest rates peak in SA, as evidenced by a slowing in repo rate hikes, cash-strapped consumer may be about to get some long-awaited relief...
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