40 000 Unregistered Credit Providers?
If you lend money to others (for profit) then that means you are a credit provider and as such should be registered with the National Credit Regulator (NCR). At present, the NCR has around 6000 registered credit providers but a new report on informal lending shows that there are as many as 40 000 unregistered credit providers operating illegally in the country.
One of the reasons government moved to make it illegal to lend money for profit without being registered is that loan sharks or mashonisas often charge way over the legal limits for interest.
Some loan sharks demand consumers bank cards or SASSA cards when lending as a form of surety. They may even demand the pin code or a person’s ID book. All of these practices are illegal and if you hear of anyone doing these things you should report them to the police as well as the NCR (0860 NCRR NCR).
You can do this even if you are not a client of these loan sharks. If you are fearful you can report their activities anonymously to the NCR who may eventually investigate and take action.
Recently, 4 out of these 40 000 illegal credit providers found their offices raided by the police and the NCR in a crack down against predatory activities. Cases have been opened and charges laid. The NCR may also take these credit providers to the National Consumer Tribunal asking for fines.
Though it is illegal to operate as an unregistered credit provider the report indicates that the number of loan sharks is growing rather than reducing as consumer struggle to gain access to credit from mainstream credit providers who do the math and know the consumer is unlikely to repay the loan they are applying for. Sadly these consumers would rather take on more debt than get out of debt by making use of the debt review process.
Rather Get Out Of Debt
If you have debt and are struggling to repay it then please go see your local Debt Counsellor rather than a loan shark. Getting out of debt is better than getting deeper into debt with illegal operators with no scruples. Debt review can help you deal with your debt stress and make sure you can afford your household essentials each month.
The NCR has a mobile office which is travelling the country trying to get these mashonisas to register and obey the law. They should not be short on work considering that the recent report says that 1 out of every 100 houses in the country is the site of illegal credit providing.