Accredited NCR Debt Counselling Services

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Know your rights and responsibilities under debt review

By on Feb 12, 2014 in Blog |

Just below 50% of South Africa’s credit active consumers are struggling with debt, and according to statistics released by the National Credit Regulator (NCR), the number of consumers with impaired records had increased by 71,000 to 9.76 million up from 9.69 million in the previous quarter. However, there is help at hand for consumers who are struggling to meet their monthly payments in the form of debt review. “The aim of debt review is to assist over-indebted consumers who are struggling to meet their financial commitments by providing budget advice, negotiating with credit providers for reduced payments, and restructuring debts,” says Kedilatile Malakalaka, manager: Debt Counselling at the NCR. Debt review services are offered by registered debt counsellors. Malakalaka advised that consumers should confirm their debt counsellor’s registration with the NCR. Consumers can also verify the debt counsellor’s registration by requesting the registration certificate which should have the NCR logo, clearly displayed name, ID number and the NCR registration number of the debt counsellor. “It should be noted that debt review is not a payment holiday and that consumers are still liable to pay their debts at reduced instalments”, cautions Malakalaka. Consumers should have a distributable income which will be used to offer reduced payments to credit providers. For many consumers already in debt, the idea of contracting the services of a debt counsellor may seem prohibitive as there are fees involved. However, debt review fees are dependent on the consumer’s disposable income and are capped. This means that consumers do not have to borrow money to pay debt review fees, adds Malakalaka. Details of the current fee guidelines can be obtained from the NCR website at www.ncr.org.za <www.ncr.org.za> . “It is critical for consumers to bear in mind that debt counsellors are not authorised to collect or distribute debt review funds. These funds must be paid to an NCR-accredited Payment Distribution Agency (PDA), and NOT directly to the debt counsellor”, clarifies Malakalaka. “Debt counsellors must also collect their restructuring fees through an accredited PDA” she adds. There are currently three NCR accredited PDAs providing payment distribution services, namely DC Partner, Hyphen Technology (Pty) Ltd, and the National Payment Distribution Agency. There are several steps that consumers who are...

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Debt counsellors want guide on lending

By on Feb 7, 2014 in Blog |

The debt-counselling industry on Thursday opposed self-regulation by banks when assessing the affordability of applicants for credit approval. Instead they want the minister of trade and industry to publish regulations on guidelines as proposed in the National Credit Amendment Bill, in consultation with the industry. They said current requirements that credit providers must comply with when conducting affordability assessments were “wholly inadequate to prevent an increase in the granting of reckless credit”. The Department of Trade and Industry wants to regulate the affordability assessments to reduce reckless lending and overindebtedness. This is just one of the elements of the amendment bill, which also deals with the removal of some adverse credit information from bureaus and strengthens debt counselling and review. The Banking Association of South Africa has argued against regulated affordability assessments as they would not provide for nuances in lending practices by banks. It wants the industry to regulate itself by a voluntary code of conduct which would incorporate affordability assessment guidelines. Appearing before Parliament’s portfolio committee on trade and industry yesterday on behalf of the debt-counselling industry, attorney Kenneth Bredenkamp submitted that the trade and industry minister should prescribe what was required from affordability assessments. They should have detailed information on financial circumstances of a client that could be verified from third-party sources such as bank and municipal accounts, and personal information of consumers. He said that regulation with proper enforcement “will ensure the industry players are aware of the boundaries and rules applicable to them, and will assist in limiting the scope for disputes. Our client does not support the idea of self-regulation and believes that the enforcement of the proposed codes is the most important function of the National Credit Regulator.” Debt counsellors wanted the minister to be empowered to draft the codes of conduct and make them part of the regulations of the act. They wanted compliance with the codes to be linked to the registration of industry players. Mr Bredenkamp proposed that the codes of conduct provide for negotiations on debt-restructuring agreements, and concessions that credit providers were prepared to make for each type of agreement. The debt-counselling industry, he said, believed that “the establishment of proper codes of conduct could lead to...

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No etoll relief for those seeking debt counselling – SANRAL

By on Jan 15, 2014 in Blog |

Debt counsellors should inform their clients that the National Credit Act (NCA) does not allow for debt relief from e-tolling fees, the SA National Roads Agency Limited (Sanral) said on Wednesday. “Responsible debt management firms must advocate that these individuals register for an e-tag in order to ensure they incur the lowest cost possible should they wish to continue to use the network,” Sanral spokesman Vusi Mona said in a statement. “This not only enables discounts and easy management portals, but ensures that the already financially stressed consumer acts responsibly.” Mona said anyone seeking debt review would not get any relief for the amounts incurred by using the Gauteng toll road network. Although Sanral sympathised and accepted that tolls added to the consumer’s burden, registering for an e-tag meant a road user paid approximately 5.6 times less than what they would if they were unregistered. Mona was responding to a claim by a debt management firm that there had been an increase in the number of people seeking debt counselling since the start of the year. In November, Sanral CEO Nazir Alli told reporters in Midrand that motorists were expected to pay within seven days of receiving e-toll bills or they would be handed over to debt collectors. “If debt collection fails, the Criminal Procedure Act will come into effect and such motorists will receive summons to that effect,” Alli said at the time. Mona said on Wednesday that although registering for an e-tag was not a legal prerequisite, “it is the most frugal thing to do other than using public transport and limiting their use of the Gauteng road network”. Courtesy...

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