South Africans are finding it more difficult to keep up with their mortgage payments as the cost of living and interest rates climb, the country's fourth-largest lender said. South Africa's central bank has raised its key repo rate by a cumulative 75 basis points this year while inflation has remained above its 3 to 6 per cent target for much of the year. "We are starting to see that strain that customers are under is starting to reflect in terms of their ability to make repayments in a consistent manner. And not just us, the industry is starting to sense that," said Timothy Akinnusi, the head of home loan sales at Nedbank. The subsidiary of Britain-listed insurer Old Mutual was not seeing more defaults in Africa's biggest mortgage market, but more clients were offering to sell their homes in the event that they could not keep up with monthly payments, Akinnusi said. The South African Reserve Bank said that although household wealth had surged as a result of rising values of financial assets, consumers remained vulnerable. South Africa's economy has slowed and is expected to grow by a relatively modest 1.4 per cent this year. Nedbank has been on a steady recovery since its retail unit was hit by soured home loans following a 2009 recession, and its 120 billion rand (HK$84.1 billion) mortgage book now has a non-performing loan ratio of 5 per cent. In order to offer better-quality loans, the lender is now arranging the majority of its home loans in-house after years of depending on third-party loan arrangers. The number of mortgages arranged by third parties now account for only about 25 per cent of loans written, down from about 70 per cent a few years ago. Nedbank's own consultants are now responsible for 35 per cent of the business. The bank is also directing potential customers to apply online and promising credit approvals within hours. Online applications accounted for 13 per cent of new loans so far this year, amounting to a total value of one billion rand, Akinnusi said. Although Nedbank has a market share of just about 15 per cent, it was not would only go after high-quality customers in anticipation of softer South African consumer demand in 2015.