Responsible borrowing isn’t about avoiding loans altogether, but taking what you know you can manage.
For many South Africans, borrowing money remains an important part of their lives for survival. However, January often brings added pressure to many, its back-to-school costs, festive season debt, and the familiar ‘Januworry’ can stretch household budgets to the limit.
As this pressure marks the start of 2026, taking on credit requires more careful planning and consideration than ever before.
Responsible borrowing isn’t about avoiding loans altogether, but taking what you know you can manage at the end of the month. This includes understanding the trade-offs, choosing the right type of credit for your needs, and knowing what support is available if things don’t go as planned.
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Six loan tips from FNB:
Michael John Davis says it is important to compare interest rates and repayment terms; it’s equally important to be clear on why you need the loan.
“Is it addressing a genuine need, supporting long-term wealth creation, or simply easing short-term pressure while creating long-term challenges?”
He emphasises that credit should serve a productive purpose. “Clear reasons for borrowing make it easier to choose the right product and avoid unnecessary strain later,” he adds.
“Lenders also pay attention to why credit is used. Borrowing for clearly defined and planned needs sends a very different signal relative to borrowing repeatedly to get through the month.”
- Do a realistic affordability check
Davis warns that a loan isn’t free money. It’s a monthly commitment that you must be able to live with for months, sometimes years.
“Without properly checking what you can afford, a loan can quickly become a problem instead of a solution,” he says.
“Affordability should be based on what you take home each month after deductions, with fixed expenses like housing, transport, food, and insurance assessed first, followed by variable costs like water, electricity, airtime, data, and so on.”
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- Understand borrowing costs
Davis says low monthly repayments don’t always mean a cheaper loan.
“Consumers should look at the full cost of credit, including interest, initiation fees, service fees, and credit insurance,” he adds.
“Using tools like loan calculators allows customers to compare scenarios and see how changes in term length or interest rates affect the total amount repaid over time.”
- Check your credit behaviour
He emphasises that one’s credit record determines how easily and affordably one can borrow, now and in the future.
“Checking your credit status before applying helps you see what lenders see and avoid costly surprises,” says Davis.
“Credit bureaus and financial institutions track borrowing patterns over time. And, while taking on more credit may give short-term relief, repeated borrowing can make future credit harder and more expensive to access.
“Your credit behaviour tells a story over time,” cautions Davis. Applying for multiple loans in a short period can negatively affect your credit score and may signal financial pressure and repayment risk, even if repayments are up-to-date.”
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- Don’t fall for offers that sound too good to be true
Davis warns that offers that rush you into borrowing are a red flag. Legitimate lenders give customers time to read agreements, ask questions, and compare options.
“Taking a beat and seeking guidance from a trusted financial institution can help avoid decisions that worsen your financial position,” he says.
“The same applies to third parties who approach in moments of financial stress, pushing you into drastic solutions, such as debt review, without fully explaining the long-term implications or exploring less severe alternatives first.
“No one should feel pressured into debt or a debt relief solution they don’t fully understand.”
- Speak up before you fall behind
FNB Retail Collections executive head Patricia Temba says many people fear the thought of the bank contacting them about their debt, often avoiding contact with their banks out of dread. “Financial pressures arise unexpectedly, and addressing them early can make a difference,” she says.
“If you’re struggling, talking to us early allows us to support you, explore workable solutions, and help prevent long-term damage to your credit record.”
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