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The use of credit cards is not well established in the student community, according to the latest SA Student Spending Report. Just 9.5% of all students surveyed have a credit card, and of these, the most popular is the Nedbank credit card, followed by Absa , then Standard Bank and finally FNB.

The newer banks such as Capitec and African Bank have very low penetration rates, below 2%. This may change though, especially in light of the fact that at present both of these banks appear to be making big inroads into the market. We can further confirm that the student population is primarily a cash orientated community, with only 16.5% of students having a clothing store account. This would appear to be the biggest opportunity for clothing brands to increase their footprint in the market, especially since the research revealed how important fashion was to students.

Of the students that do have store accounts, the most popular were Edgars and Truworths. What's really interesting is that about 70% of students with store or credit card accounts had amounts of less than R500 per month outstanding in total, which tells us that they are not running up a huge amount of debt on their cards. 64% generally settle their store accounts themselves, with others receiving help from parents and family (34%). It seems that students are in charge of their affairs, with half of them confident that they can make their payments every month.

Nevertheless, if they were to default, the majority of students (60%), would rather default on their credit card account than on their store account. It appears that students don't fully grasp the ramifications of defaulting to the bank, when clothing is obviously the key driver in their lives.


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