Over-indebted consumers advised to consider debt counselling
Despite life progressively returning to normal as lockdown levels are eased and economic sectors return to productivity, many consumers are facing the bleak prospect of being blacklisted.
MANY consumers are feeling the impact of the Covid-19 lockdown on their jobs and income, with some falling behind on their financial obligations.
The National Credit Regulator (NCR) has advised, however, that financial distress can be carefully navigated by debt counselling.
Despite life progressively returning to normal as lockdown levels are eased and economic sectors return to productivity, many consumers are facing the bleak prospect of being blacklisted.
Many South African households are in significant financial hardship and others have been struggling to make ends meet even before the Covid-19 pandemic, says advocate Kedilatile Legodi, NCR acting manager for Education and Communication.
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Debt counselling, which can be entered into individually or as a couple married in community of property, provides an opportunity to consumers to repay debts without borrowing more money or taking on extra debt.
According to the National Credit Act (NCA), a consumer is also protected if they continue to honour repayments while under debt counselling, until all debts are paid up.
If a consumer is considering debt counselling, which is sometimes referred to as debt review, the NCR says an individual must have an income and not be under debt administration.
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Critically, warns the regulator, once a consumer applies for debt counselling, they will not get any further credit and the person’s name will be flagged at the credit bureaus.
Debt counselling is offered by NCR registered debt counsellors, whose status can be verified on the NCR website (www.ncr.org.za) or by calling on 0860 627 627.
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