Tag: interest rates

Despite higher inflation, interest rates and cost of living, the South African insurances market experienced a revival during the last two years, with the gross written premium across the local insurances market expected to show an annual growth rate of 5.14% from 2024 to 2028 (CAGR 2024-2028), achieving a market volume of US$100.30 billion by 2028.

Ask any budding young entrepreneur in South Africa what they need most, and they will probably rattle off a list as long as your arm: Some moola to invest in their business. A stable electricity supply. The eradication of crime that destroys businesses and results in financial loss. Lower borrowing costs. Reasonable interest rates. And the list goes on.

South African banks have weathered rough seas during the past year, with many of their customers coming under severe pressure from a stagnant economy, rising cost of living and high interest rates. Despite these storms, the financial services industry is still delivering good profits and growth, but there is constant pressure to maintain these results amid the adverse market trends and pressures that are currently shaping the landscape.

Against all odds, 2024 is still believed to be the year of the first-time homebuyer resurgence. And while it’s a slow climb to the top, a combination of low house prices, competitive bank interest rates and impending rate cuts has many aspiring homebuyers hungry to get into the property game.  

Investing in an offshore retirement fund is one way of growing your wealth in a stable economy over the longer term, or even gaining residency in a foreign country. However, for South Africans, this scenario presents as many challenges as it does opportunities and should only be considered after consulting with a financial adviser and tax expert.

With an economic growth forecast of only 1.6% over the next three years for South Africa, businesses are facing a tough trading environment, exacerbated by the impact of geopolitical tensions, disruptive new technologies, persistent weather catastrophe threats and failing public infrastructure and services.

One of the outcomes of the latest issue to swap the world – low growth, high interest rates and the threats of recessions – which will remain a driver for the growth of new ways of working and alternative business models for many years to come, is the increasing development of the side gig economy.

Before we can unpack the operating challenges and opportunities in transactional banking, we need to emphasise this point. The global economy has faced a re-set of sorts as inflation has spiked higher and global interest rates have risen from historical lows. It is certainly not ‘business as usual’ in the world of financial services and banking.

Small and medium-sized enterprises (SMEs) are the beating heart of Africa’s economies. According to the World Economic Forum, as engines of growth, SMEs are responsible for around 80% of the continent’s employment, ultimately helping to reduce poverty and income inequality, enabling the establishment of a new middle class and driving demand for new goods and services.

High interest rates increase the income opportunity of one’s savings and investments. In a volatile economic landscape, the importance of prudent financial planning and savvy saving strategies becomes more critical than ever. When inflation is high, the value of money seems to shift like sand beneath our feet, with a knock-on effect on interest rates and the cost of living.