Consumers – Brands & Advertising · Editorial

By Moakanyi Magazine · Global Issue · June 2026

Credit is meant to bridge a gap, not fill it every month. When living costs climb faster than incomes, the line between the two blurs – households borrow not to buy ahead but to keep up, and the retail account that once smoothed a large purchase starts covering the weekly shop. Rising living costs increase consumer credit stress, and that stress is felt first by the retailers and lenders who carry the balance.

Botswana's budget, which projects an economic rebound this year, frames a recovery that households may feel later than the headline suggests. A rebound in output does not immediately ease the cost pressure on a stretched family budget, and the gap between a recovering economy and a recovering household is exactly where credit stress accumulates.

When store credit becomes a coping mechanism

Retail credit in Botswana, from furniture accounts to hire-purchase and store cards, expands easily when times are good. Under cost pressure, the same accounts shift from convenience to necessity, and repayment rates come under strain. For retailers and brands that extend credit, the risk is a rising book of slow or missed payments – a margin that looked like a sale but becomes a liability.

The warning sign is subtle: not a wave of defaults but a slow lengthening of repayment, the customer who keeps the account open but pays the minimum, the balance that stops shrinking. By the time it shows in arrears figures, the stress has already been building for months. Reading it early means watching behaviour, not just balances.

There is a macro dimension too. When many households lean on credit to cover essentials at once, the strain stops being a string of individual cases and becomes a pattern across a lender's book. A retail credit portfolio built in good times can carry hidden fragility into a costly one, and the business that grew its book fastest may find it has grown its risk fastest as well. The Bank of Botswana and prudent lenders watch this aggregate stress precisely because it builds quietly before it breaks.

Credit used to cope is credit most likely to come back unpaid.

The brand cost of pushing credit too hard

Advertising that leans on easy credit can win a sale and lose a customer. A brand that pushes credit aggressively into a stressed market risks both default and reputational damage when collection turns difficult. The measured approach is to market value and durability over instalment size – to sell the product, not the financing. In a high-cost environment, the brands that protect their credit book also protect their standing.

There is a longer game here too. A customer pushed into an unaffordable account is not a customer for life; they are a collection problem and a damaged relationship. A customer sold something they can actually pay for returns. In a small market like Botswana, where reputation travels fast, the brand that resists over-extending credit keeps the goodwill that aggressive lenders burn through.

Advertising sets the tone for all of this. Campaigns that foreground low monthly instalments while keeping the total cost in the small print attract exactly the buyers least able to carry the debt. Marketing that leads with the full price, the real term and an honest sense of affordability attracts buyers who can pay – a smaller pool, but a sounder one. The creative choice and the credit outcome are the same decision made twice.

The cheapest sale to advertise is the one the customer can actually repay.

What disciplined lending looks like now

For Botswana lenders and retailers, the cost-pressure period rewards discipline: tighter affordability checks, realistic limits and clear terms. This protects the household from a debt spiral and the business from a bad book. It is slower growth on paper, but it is growth that holds. The alternative – lending into stress and hoping the rebound arrives in time – is how a sales line becomes a write-off.

Disciplined lending grows slower and breaks less.

The so-what for Botswana is straightforward. As living costs press on households ahead of any felt recovery, consumer credit stress is a shared risk between buyer and seller. Retailers, brands and lenders that read it early – marketing value over financing, lending within reach – will carry a cleaner book into the rebound, while those that chase the instalment sale may find their growth was borrowed.

Sources: Reuters