SA Credit Amnesty

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WHAT DOES THE SOUTH AFRICAN CREDIT AMNESTY ENTAIL?

It is a proven fact that South Africans are over-indebted. Recent economic research statistics have indicated that many South Africans who are older than 16 are living in debt. Gathered information and financial indicators also show that the number of people with formal credit or loans has increased over the years. This has indeed painted a very bleak picture and attracted the attention of government and other cooperating financial industry players.

In a bid to correct this situation, government decided to exercise its power and make amendments to the National Credit Act. The logic behind this change is the fact that seven years after the introduction of the National Credit Act in 2007, statistics supplied by many credit bureaus show that the majority of the population in debt is debt impaired. This by extension includes individuals who have repaid their debt but have not had the legal know how and financial resources to approach the courts and have judgements against them rescinded.

The National Credit Amendment Bill therefore brought to the fore what has publicly been lauded as the Credit Amnesty. While many have not understood or even misinterpreted what this Amnesty means, the Amnesty is not an opportunity for non-cooperating debtors to escape debt. It is rather a window of opportunity that entails changes with the type of credit information kept by bureaus. It places the responsibility on credit bureaus to clear those who have repaid debts and totally remove adverse classification of consumer behaviour and enforcement action.

The Amnesty will assist those that had adverse information even though they had paid the debt in full. Consumers will no longer have to approach courts to rescind paid up debt. However, they might need to provide credit bureaus with paid up letters if their creditors have not done so already.

By purchasing a Credit Health Report, individuals can easily be comprehensively kept updated on developments regarding their credit status.