The National Credit Act (Act 34 of 2005) was drawn up to ensure consumer protection and industry standards within the credit world – and as a result, instigated the creation of the National Credit Regulator. With legislation to ensure all is fair in debt and credit, it follows certain key points as guidelines:
Its key features include:
- Specific language in credit agreements – it must be simple and understandable by all consumers.
- Quotes must be given on all credit agreements, these are binding for up to 5 days.
- Advertising and marketing of agreements must include prescribed information on the cost of credit.
- Credit sales at a person’s work or home are strictly limited.
- Reasons must be provided if the credit application is rejected.
- Automatic increases in credit limits are regulated.
- Reckless lending is prohibited.
- Interest and fees are regulated on all agreements, including micro-loans.
- Credit Bureaus are regulated, consumers have the right to one free credit check a year.
- Debt counselling must be introduced to enable restructuring of debts regarding over indebted consumers.
As credit is one of the common lubricating factors of the economy, promoting commercial activity, it is something every consumer should be clued up on, as well as the Consumer Protection Act. However, as many spend money they don’t have, take on too much debt and get caught in the debt trap, the National Credit Regulators had to be developed as the watch dog of the credit and lending industry. Ensuring fairness, accessibility and consumer protection on a legal basis, this is the body that ensures all credit and debt matters are handled in line with legislation.
Dealing with matters like unfair collection, reckless lending and all types of loans, the National Credit Act is the legal basis for consumer protection within the debt industry – promoting a fair and non-discriminatory marketplace. It is also its purpose to allow access to debt to the lower income levels of society, allowing them to become active members of the economy.
For guidance and advice on your debt and debt solutions, contact Quick Consolidation Loans today.
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We will be able to offer advice on the suitability of debt consolidation to your specific financial situation, as there are instances where it would prove unsuitable. Our consultants will be able to help you with regards to secured and unsecured debt consolidation, and advice as to which would be most favorable to your outstanding debts. Operating on a national basis, we can also provide you with debt counseling or a debt review in South Africa. As mentioned, debt consolidation could save you on monthly payments and interest rates, which has made it a viable option for many. To find out if debt consolidation in South Africa is an option for you, contact Quick Consolidation Loans today.