NCR quiet about voluntary debt mediation
VDMS or voluntary Debt Mediation as proposed by the National Debt Mediation Association ( NDMA) is currently being investigated by the National Credit Regulator.
Debt Mediation sounds like a great idea to many since so many South Africans are in financial difficulty at the moment.
Debt Counsellors who are alternative dispute resolution agents are for many the only choice when it comes to debt mediation.
The NDMA have proposed the use of a debt review tool from BASA called DCRS and the use of Debt Counsellors who will voluntarily use this computer program to make debt mediation proposals to creditors who are NDMA members.
Some Debt Counsellors are concerned that Debt Counsellors should not be involved , others feel that they must be involved still others feel that Credit Providers (or a credit provider representative body like the NDMA) should not “run” the debt mediation space as they would naturally be biased toward creditors. Some Debt Counsellors are concerned that the process is so similar to debt review but offers the consumer no actual legal protection that it could confuse and ultimately hurt consumers. They say consumers must be afforded all the rights assured by the National Credit Act and that this project might be an attempt by the banks to circumvent all the NCA’s requirements. These and many other points of concern are being investigated by KNY consulting for the NCR.
This month saw the DCI speak out against VDMS. TheDCI is a Debt Counselling forum which focuses on consumer education.
You can visit their site at www.thedci.co.za
They have said things like: “Debtor beware! Think twice. The NDMA debt mediation process has been set up by credit providers. Do you think it is designed to work in your favour or might the outcome tend to favour the credit industry?”
Want to know more?
Head over to our dedicated Voluntary Debt Mediation page to learn more: http://debtfreedigi.co.za/voluntary-debt-mediation/