Furniture giants profit from low income earners’ misery


If you go through annual reports of  companies that are in the business of selling household goods through hire purchase, you might be surprised that, in spite of the depressing trading environment they whinge about, they are not in the red at all. Little do you know that the low income worker’s is sustaining the trend.

Transform SA found that household names in the furniture business have been making a killing out of charging their clients – mostly low income earners –  initiation fees, insurance, astronomical interest rates and other hidden costs.

In most cases, the due diligence that furniture companies are supposed to exercise, in accordance with the National Credit Act (NCA), is deliberately overlooked and people who might not manage to service payments are granted goods on credit. Some of the startling cases of exploitation that Transform SA discovered were the following:

  • A dining set that valued at R7999 ends up costing R20 384 after three years of instalments
  • Ridiculously, someone can pay R5000 for a R700 DVD player after 3 years
  • a fork lift driver earning R2100 servicing a debt of R8976, which is to be finished in three years

Leave a Reply

Your email address will not be published.