Debt review is regulated by The National Credit Act. This act was created as a means of balancing the credit and debt industry in South Africa and to find more suitable ways for consumers and creditors to settle differences due to late payments and over-indebtedness. There are various sections in the act that are dedicated to protecting consumer rights and ensuring fair credit practices in South Africa.
Of particular importance is the fact that The National Credit Act makes provision for consumers to apply for debt review. Before the act was enacted, consumers did not have a legal remedy that protected them in times of tough debt. Instead their options were limited to serious remedies such as bankruptcy and sequestration. However under the regulations of The National Credit Act, consumers can now take control of their finances.
In terms of the act consumers can apply for debt review and be entitled to a restructured debt repayment plan and protection from legal action by creditors once the application for debt review has been filed.
The National Credit Act also established the National Credit Regulator, a regulating body that oversees all credit practices in South Africa. They are there to make sure that these new laws are enacted properly and that all credit and debt practices adhere to these regulations.
The rights that consumer are entitled under The National Credit Act ensure that they enjoy fair treatment and protection from unscrupulous credit practitioners. Since the inception of the act debt review has become a booming industry and consumer have been reaping the rewards.
Article written by: Andrea van Tonder 06-2013