By Kudzai Kuwaza
EMPLOYEES hold more housing loans and personal loans than car loans with the banking sector getting the majority of the loans, a survey has revealed.
The study was carried out by Industrial Psychology Consultants and is titled Financial Wellbeing Survey Zimbabwe Employers Loan.
The average housing loan amount in urban areas is US$42 000 whereas the average loan amount in rural areas is US$13 000, the survey revealed.
“For personal loans, housing loans and car loans, the banking sector is consistently among the sectors whose employees hold more loans,” the survey revealed. “Furthermore, interest rates in the Banking sector are the lowest.
In other words, the cost of borrowing is cheapest for employees in the banking sector.”
There were 830 participants in this survey. Most of the participants (74%) in the survey were in the US$500 to US$3 000 income bracket.
The survey revealed that among respondents in the “Below US$500” income bracket, none of them have car loans.
“However, participants in the same bracket have personal loans and housing loans indicating that transport is not a high priority,” the report noted.
The survey revealed that car loans still remain the least popular of the loans taken, behind the personal and housing loans.
The report also revealed that the proportion of loan holders is greater among house owners and those that stay in company houses.
The survey revealed that at least a third of the respondents from banking (33%), insurance (31%) and energy and oil sectors (36%) have housing loans.
A quarter of the respondents, the survey revealed, are from the manufacturing sector and have housing loans. Other sectors with housing loans include telecoms (27%), medical services (20%), mining (19%) and transport logistics (11%).
The survey found that 22% of the respondents who have car loans are from the banking sector. Other sectors which access car loans include manufacturing (17%), insurance (18%), telecoms (16%) and mining (9%).
The banking sector also had the highest percentage (78%) of those who access personal loans. Other sectors which access personal loans include energy and oil (75%), agriculture (72%), professional services (30%) and tourism (60%).
The survey also established that the request for salary advances within the various sectors does not follow the job levels.
“In other words, regardless of level of employment, employees run out of money and request for salary advances,” the report noted. “We observed that as responsibility increases (as measured by the number of children supported), the number of loans that are taken increases.
“However, the same was not observed when we investigated the impact on loans as the size of extended family supported changes. This may be an indication that decisions to borrow are mostly driven by an employee’s immediate responsibilities (their children),” the report noted in its conclusion.
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