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National Credit Act Law

Relief for borrowers following SCA ruling

Borrowers with more than one debt outstanding were given some protection last week when the SCA ruled that the interest rate on short-term loans after the first loan cannot exceed 3% a month. GroundUp reports Micro Finance SA (MFSA) had challenged regulations promulgated under the National Credit Act reducing the interest rate on a second short-term loan taken out in a 12-month period from 5% to 3% a month.

Lending to a Friend or Selling Property on Credit - Must You Register as a Credit Provider?

By Ashersons Attorneys Published on Wednesday, 05 December 2018
Tags: #General Legal Practice #National Credit Act Law
It seems logical that the very strong consumer protections in the NCA (National Credit Act) are designed for commercial situations in which credit is advanced by “credit provider” businesses to “credit consumers”. But does the NCA also apply to non-commercial, once-off loans? Like a loan to a friend or relative? And what about property sales?

Edgars club fees issue heads to SCA

By Juta and Company (Pty) Ltd Published on Tuesday, 04 December 2018
Tags: #Litigation #National Credit Act Law
Edgars’ right to collect more than R450m in club fees from those who buy on credit is under attack again as the National Credit Regulator (NCR) has applied – and been granted – leave to appeal against a Gauteng High Court (Pretoria) decision that Edcon’s club fees are lawful.

Garnishee orders still open to abuse

The Credit Ombud, Nicky Lala-Mohan, says it seems there is still widespread abuse of the garnishee order system to deduct debt repayments from employees, despite a far-reaching Constitutional Court ruling tightening up the issuing of these orders. In September 2016, the Constitutional Court confirmed a High Court ruling by Judge Siraj Desai that aspects of the enforcement of emolument attachment (EAO) were unconstitutional, notes a report on the IoL site.

Nedbank cleared of 'reckless lending'

By Juta and Company (Pty) Ltd Published on Tuesday, 08 May 2018
Tags: #Litigation #National Credit Act Law
The National Credit Regulator has advised a financially-vulnerable consumer to seek the services of a debt counsellor to ‘assist her with possible over-indebtedness’ but has not found Nedbank guilty of reckless lending practices as contended, notes a Moneyweb report.

Appeal against credit ruling being considered

By Juta and Company (Pty) Ltd Published on Wednesday, 11 April 2018
Tags: #Litigation #National Credit Act Law
The National Credit Regulator is considering appealing a recent Western Cape High Court judgment that on the face of it makes qualification for credit that much easier, notes Legalbrief. In the case brought by leading retailers Truworths, Foschini and Mr Price, the High Court ruled credit applicants would no longer be required to provide proof of income when applying for credit, as previously required by the National Credit Act.

Debt relief Bill could see R20bn written off

By Juta and Company (Pty) Ltd Published on Wednesday, 14 February 2018
Tags: #Consumer Protection Law #National Credit Act Law
The Treasury estimates the total debt that could fall under debt extinguishing provisions of the National Credit Amendment Bill proposed by Parliament’s Trade and Industry Committee could range from R13.2bn to R20.7bn, notes a Business Day report.

Courts at odds on debt review issue

Debt counselling, implemented as an alternative to sequestration for indebted consumers, is a ‘disaster’ for many consumers, according to practitioners. Rapport notes that the issue of customers wanting to abandon the debt review process has become more complicated with the Western Cape and Gauteng High Courts at odds on the matter.

Capitec 'loan shark' label unfounded

By Juta and Company (Pty) Ltd Published on Wednesday, 31 January 2018
Tags: #Banking & Finance Law #National Credit Act Law
Capitec Bank is the latest target of Viceroy Research – the team that produced an explosive report detailing how Steinhoff cooked its books to hide losses and inflate earnings, says a BusinessLIVE report. Viceroy describes Capitec as a ‘loan shark with massively understated defaults masquerading as a community finance provider’ in a report it released yesterday.

Recover debt: “A small debt produces a debtor; a large one, an enemy”

By Esmeraldo and Associates Published on Thursday, 21 December 2017
Tags: #Litigation #National Credit Act Law
There are so many companies and individuals out there trying to escape their responsibilities of payment of monies due to others. It is distasteful at the least, but people often loan goods or services or even monies to somebody. They promised to pay you back for services, goods or monies lent.

Bank accused of reckless lending

By Juta and Company (Pty) Ltd Published on Monday, 11 December 2017
Tags: #National Credit Act Law
The National Credit Regulator (NCR) has stepped in to investigate a case of alleged reckless lending against Nedbank after reading about it in the press. Moneyweb previously reported that retired education specialist, Myrlene Pieterse, approached the Ombudsman for Banking Services on behalf of a financially uneducated employee, contending that Nedbank engaged in reckless lending practices by not adequately explaining the implications of the credit.

ConCourt decision fails to stop dodgy

Johannesburg attorney Gilad Cohen believes the Constitutional Court’s decision to dismiss an application to access the court by defaulting debtors who cannot meet their home loan payments does not help to alleviate unscrupulous behaviour by resellers, according to a Business Day report.

Garnishee fraud remains rampant

Despite the Constitutional Court’s landmark ruling on the illegality of certain practices in the administration of garnishee orders – made more than a year ago – activists claim that fee-gouging and fraudulent court orders are continuing unabated, according to Business Day. Lisinda Bailey, one of the applicants in the Western Cape High Court case on garnishee orders that was confirmed by the Constitutional Court, says her life was ruined by the irresponsible granting of credit and subsequent garnishees.

BMW ordered to repay 'on-the-road' fees

The National Credit Regulator (NCR) has directed BMW to refund its customers for charging them an on-the-road fee on credit agreements, says a TimesLIVE report. The regulator said it was not aware what the fee was for as BMW did not explain when it inquired. The charges ranged from R3 000 to R6 000.

Debt delinquency gathering momentum

By Juta and Company (Pty) Ltd Published on Wednesday, 20 September 2017
Tags: #National Credit Act Law
The debt distress industry is booming with about 16 000 South Africans signing up each month for debt review as allowed under the National Credit Act (NCA). A Moneyweb report says the number of SA consumers in distress has grown 61% since the NCA became law in 2007, while the number of credit-active consumers has grown 44% to more than 24m, according to figures from the National Credit Regulator’s Credit Bureau Monitor.

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