Namibia’s household debt increased by N$109 million in April to reach N$68.8 billion, driven mainly by growth in mortgage credit, even as overall consumer borrowing remained restrained due to ongoing financial pressures and weak income growth.
Simonis Storm junior economist Almandro Jansen said household credit growth in April edged down to 2.7% from 2.8% in March.
Jansen said the pace reflects persistent affordability pressures and stagnant wage growth, though pockets of resilience remain in specific credit segments.
“The standout performer in April was mortgage credit, which rose by N$93.3 million to a new 2025 high of N$45.7 billion. This increase came despite ongoing affordability challenges, with elevated home prices and stagnant income growth still weighing heavily on purchasing power,” said Jansen.
He said the uptick may signal that some consumers with stable incomes are pressing ahead with property purchases, possibly in anticipation of lower interest rates later this year.
Other household loans and advances rose by N$16.5 million to N$12.5 billion. This slower growth indicates cautious borrowing, with middle-income earners appearing to prioritise debt repayment and tighter household budgeting over new credit obligations.
Household overdraft facilities continued to decline in April, down N$67.8 million. Jansen said this underlines restraint among lower-income borrowers who remain wary of tapping short-term credit given uncertain income prospects.
In contrast, instalment and leasing credit held steady at N$8.2 billion, supported by sustained vehicle sales and consumer durable purchases. Jansen said this segment continues to outperform, driven by competitive offerings in secured lending markets.
“Although household credit growth remains below long-term averages, the consistency in instalment credit and declining reliance on unsecured debt highlight an ongoing adjustment toward more sustainable and asset-based borrowing patterns,” he said.
Meanwhile, business credit growth slowed to 7.1% year-on-year in April, down from 8.2% in March. Overall corporate debt fell marginally by N$7 million to N$49.5 billion, reflecting a more conservative approach by firms navigating complex financial conditions.
Instalment and leasing credit for corporates softened slightly to N$6.5 billion.
However, Jansen said the figures still point to sustained capital investment, particularly in logistics, transport, and energy. Firms appear to be directing spending toward vehicles, machinery, and operational infrastructure.
Other loans and advances stood at N$20 billion, with growth moderating as repayments picked up.
“Activity slowed particularly in the manufacturing and services sectors, where Jansen noted some projects are being paused or phased in gradually. Still, the category remains stronger than pre-pandemic levels,” he noted.
Overdraft usage by firms dropped sharply by N$830 million to N$9.6 billion. Jansen said this likely reflects businesses drawing down on existing facilities to fund operational needs, especially in inventory-heavy or seasonal sectors.
Corporate mortgage lending continued to decline, with outstanding loans falling to N$13.2 billion. The trend points to a retreat from long-term property investments as companies shift toward more flexible, asset-light strategies in response to high building costs and changing workspace demands.
“In sum, while the pace of corporate credit growth has eased slightly, the landscape remains generally positive. Investment appetite is holding up in key sectors, and the overall tone of borrowing suggests that businesses are focused on productivity-enhancing upgrades rather than speculative expansion,” said Jansen.
