THE Central Bank of Eswatini (CBE) has urged households to prioritise financial discipline and reduce debts as the year begins.
The bank warned that increasing stop orders and excessive borrowing eroded disposable income and undermined households’ well-being.
In a statement, the bank also noted that salaries were largely exhausted by loan repayments before reaching month-end.
In such cases, they said individuals relied heavily on borrowing to meet their everyday needs, thus deepening financial vulnerability and limiting their ability to save.
“Beyond empty pockets, over-indebtedness and persistent pressure leads to stress, depression, anxiety and other serious health challenges. The impact of over-indebtedness extends beyond financial strain.
“If you need a new year’s resolution, start with financial freedom. Is your salary disappearing before you even touch it? Many Emaswati feel they are working solely for stop orders as debt swallows their paychecks. This is a clear sign of over-indebtedness, when you rely on new debt just to make ends meet,” stated the bank.
CBE further advised the nation to take control of their finances with several resolutions, including following the 50-30-20 rule; allocating 50% of pay to needs, 30% to everyday expenses and 20% to savings.
The bank also suggested being honest when applying for credit, further suggesting that disclosing all debts, including stokvels, commitments and external moneylenders, to ensure they do not take on more than they can handle.
“Be curious and do not be afraid to ask the necessary questions before you commit. Manage your lifestyle by avoiding the cleared loan trap where you immediately take a new loan just because an old one is finished, only to blow it and fall back to the same trap. Choose to breathe easy this year and look forward to every month-end,” added the bank.
