National Credit Amendment Act
16 March 2015
The following Government Gazettes were published on 13 March 2015:
- Proclamation of the commencement of the National Credit Amendment Act (Amendment Act)
- Promulgation of the National Credit Regulations including Affordability Assessment Regulations (Regulations)
- Promulgation of the amendment of regulations for matters relating to the functions of the Tribunal and rules for conduct of matters before the National Consumer Tribunal
The Amendment Act aims to:
- Tighten up the way debt counsellors operate
- Empower the CEO of the National Credit Regulator (NCR) to delegate functions to other NCR officials
- Allow debt counsellors to voluntarily cancel their registration
- Empower the NCR to cancel registrations
- Empower the National Credit Tribunal to suspend reckless credit agreements
- Set up alternative dispute resolution mechanism
The Regulations flowing from the Amendment Act call on credit providers to “take practicable steps” to assess a consumer’s income status to ascertain whether repayment of a loan can be made, and specific guidelines and formula will require compliance.
In addition, three months’ bank statements or payslips must be looked at and the consumer has to provide the credit provider with authentic documentation in order to carry out the assessment effectively.
A consumer’s credit profile as contained in a credit bureau must also be considered.
The Regulations also deal with the criteria for registration as a payment distribution agent, the transitional period for payment distribution agents already registered, and the duties and obligations of payment distribution agents.
Conference on the amendments to the National Credit Act
The Department of Trade and Industry and the NCR will host a conference on the new National Credit Amendment Act under the theme "Strategies to Reduce Over-Indebtedness in South Africa". The conference takes place at Birchwood Hotel, Boksburg on 19 March 2015.
The conference will also talk to the rising concerns regarding the abuse of emolument attachment orders.
This conference marks the beginning of the implementation plan to raise awareness on the new amendments.