Gambling is emerging as a silent but growing driver of household financial distress, deepening debt pressures as South African consumers grapple with rising living costs.
According to DebtBusters, gambling activity is widespread among consumers seeking debt counselling, often diverting money away from essentials such as food, transport and debt repayments.
In many cases, repeated spending on online gambling apps builds up rapidly over a few months, adding to already stretched budgets and increasing reliance on credit.
DebtBusters executive head Benay Sager told the media on Wednesday that gambling is increasingly visible in consumer spending patterns, particularly on payday. He said small amounts are often placed before payday and later escalate into much larger sums once salaries are paid.
These repeated transactions not only drain income, but they also attract bank transaction fees, further eroding take-home pay. The behaviour contributes to an emerging financial epidemic as consumers falsely believe gambling can supplement their income. This trend comes against the backdrop of a decade-long deterioration in household finances, despite recent improvements in consumer confidence.
The Q4 2025 Debt Index released on Wednesday, which marks DebtBusters’ 10th year of data, shows that though interest rate cuts in 2025 and lower inflation helped ease pressure, expenses continue to outpace income growth by a wide margin.
Though the average interest rate for unsecured debt is somewhat lower, at 21.9%, it remains stubbornly high. Debt counselling is the best way to restructure this debt, reducing unsecured rates to about 2.6% per annum and negotiating vehicle debt to more manageable levels
— Benay Sager, DebtBusters executive head
Over the past decade, electricity tariffs have risen by 165%, petrol prices by 74%, and cumulative inflation by 49%, while income growth has lagged far behind.
As a result, the organisation said consumers applying for debt counselling in the fourth quarter of 2025 needed 71% of their take-home pay just to service their debt. This is the highest level since 2017 and highlights how little room households have to absorb financial shocks.
Reliance on high-interest debt has reached record levels. Sager said almost all consumers entering debt counselling now have a personal loan, while more than half rely on short-term payday loans. These forms of credit are increasingly being used not for discretionary spending, but to cover basic living costs.
Purchasing power has also collapsed. Compared with 2016, consumers who entered debt counselling in late 2025 took home about 47% less in real terms once inflation is factored in, despite nominal income growth of about 2% over the decade, said Sager.
Financial stress is not limited to lower-income households. High earners are also under significant pressure, with consumers earning more than R35,000 a month using about 85% of their income to service debt, according to the index.
Sager said their debt-to-income ratios are at record levels, driven largely by unsecured borrowing and vehicle finance. Unsecured debt among top earners is now 75% higher than in 2016, far exceeding inflation and income growth.
Debt stress is also shifting older. The average age of new debt counselling applicants has risen to 40, while the share of applicants aged 45 and older has increased from 20% in 2016 to 31% in 2025.
Even with these pressures, debt counselling continues to play a stabilising role. In 2025, consumers under DebtBusters’ programmes repaid R5.3bn to creditors, allowing money to flow back into the economy. The number of consumers completing debt counselling is now almost 12 times higher than it was a decade ago, DebtBusters said.
The release of the latest Debt Index coincides with National Debt Awareness Month, which focuses on helping consumers better understand and manage their debt. Sager said interest in online debt management tools is growing, with subscriptions rising sharply compared with the previous year.
“Though the average interest rate for unsecured debt is somewhat lower, at 21.9%, it remains stubbornly high. Debt counselling is the best way to restructure this debt, reducing unsecured rates to about 2.6% per annum and negotiating vehicle debt to more manageable levels,” Sager said.
The rapid growth of online gambling has drawn increased attention from the government, with total gambling turnover estimated at about R1.5-trillion in the 2024/25 financial year. Authorities have flagged online betting in particular as a growing risk to consumers, citing its ease of access, aggressive marketing and links to rising household financial stress.
In response, the National Treasury has proposed a 20% tax on gross online gambling revenue, over and above existing provincial gambling taxes. The measure is intended to act as a deterrent to excessive gambling rather than a revenue-raising tool, and forms part of a broader effort to limit the social and financial harm linked to betting.
Regulators are also moving to tighten advertising rules. The National Gambling Board in its latest Strategic Plan for the 2025/26 to 2029/30 financial years says it is targeting intrusive and non-compliant gambling advertising, especially content that reaches minors or downplays the risks of gambling. Proposed measures include restricting advertising times, limiting influencer and sports sponsorship marketing, and enforcing clearer responsible gambling warnings.
“The NGB will address the regulatory gaps surrounding advertising and sponsorships, particularly within the betting sector, to mitigate the societal impacts of excessive and unchecked exposure to gambling marketing,” it said.
Enforcement action is being stepped up against illegal and offshore gambling platforms, alongside efforts to strengthen consumer protections. These include improved identity checks, better tracking of gambling activity, mandatory spending limits, expanded self-exclusion mechanisms and increased funding for treatment programmes.
Business Day
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