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Credit data released by the SA Reserve Bank (SARB) on Wednesday shows that consumers have been spending less, weary that they could quickly end up drowning in debt, and that banks haven't yet loosened their lending criteria.

In August growth in demand for credit by the country's private sector decreased to 2.34 percent year-on-year from a revised 3.31 percent in July, the SARB said.

Commenting on the data, Standard Bank econommist Shireen Darmalingam said growth in credit extension was edging closer to zero and was likely to decelerate until a protracted stabilisation phase of the economy enticed consumers to up spending levels.

However, she added that consensus existed that consumers would not easily revert to previous spending patterns.

"Insolvencies should gradually start declining and should assist, to a large degree, in limiting further declines in consumption expenditure as the economy makes strides towards emerging from the recession," Darmalingam noted.

She said the take-up of corporate credit was likely to fall short of expectations, as effective balance sheet healing would hinge on a healthier consumer base.

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