NCR Refer Next Creditor To NCT Over Club Fees
Recently the National Consumer Tribunal (NCT) ruled that a credit provider (in that particular case Edcon) is not allowed to charge a “club fee” since it is not included in the National Credit Act or regulations as a permissible fee. Edcon have appealed that ruling saying that the fee is not for credit related services. Recently, Edcon have been bringing in over R400 Million in club fees monthly. Having to pay that amount back for all the months and years since the NCA came into effect will be hard for the brand to survive.
Now because of that outcome, it seems, the NCR will be rolling this type of application to the NCT for various Credit Providers throughout the entire retail industry that have and do charge such fees. The next in line after Edcon for investigation and punishment is Mr Price Group. The NCR have announced that following an investigation they are now taking Mr Price to the NCT and will also ask for a total refund of fees to consumers and a fine.
‘It should line up many easy wins for the NCR at the tribunal and boost their reputation’
It should line up many easy wins for the NCR at the tribunal and boost their reputation…unless Edcon win their appeal case. If that happens then the NCR will have to withdraw the applications in all likelihood. Alternatively, the Regulator may settle out of court with these credit providers as it has done in the past (but normally that happened before a ruling in their favour).