Public Hearings At Parliament About Draft NCA Amendments
Public Hearings About Draft NCA Amendment Bill
Recently, the Portfolio Committee on Trade and Industry introduced a draft bill that could soon become law. The Bill introduced the concept of “Debt Intervention” a system where the Minister of Trade and Industry can identify certain groups of people to qualify for reductions or even halting of debt repayments for 12 or 24 months and ultimately even a write off of unsecured debt.
Reckless Lending Could Overwhelm Debt Review
The Bill also introduces certain new requirements for Debt Counsellors (and credit providers) such as every account having to be investigated for reckless credit (which involves credit providers supplying hundreds of thousands of original documents used to evaluate every credit application). The Bill also makes it a finable or punishable offence not to mention that a credit agreement could be reckless.
Any credit agreement where (1) the consumer did not understand the credit agreement or where (2) the consumer did not receive a pre-agreement (quote) or where (3) an affordability assessment was not effectively conducted is reckless. A credit agreement is also reckless if the consumer could not realistically repay the debt in the manner demanded.
‘Debt Counsellors will have to aver reckless credit on all accounts’
A huge danger lies that since Debt Counsellors will have to investigate each matter and ask for documents that credit providers will fail to respond with the needed documents within a few days and then Debt Counsellors will have to aver reckless credit on all accounts. This will mean an end to consent orders and clogging up the courts with reckless credit cases. If Debt Counsellors fail to aver reckless credit, where they never received the documentation, they could face liability claims from consumers, NCR fines or worse.
Every reckless credit matter then (ie. every matter entering debt review) would also need to be sent to the NCR for investigation flooding and probably overwhelming them in a few days. If thousands or hundreds of thousands of these matters eventually become NCT orders and fines of hundreds of millions of Rands then some credit providers (and their share prices) could also face a systemic threat and is something to be considered.
While motivated by a desire to encourage reckless credit investigations (which are currently very costly for consumers and create a huge extra workload for Debt Counsellors) the wording of the Bill could cause Debt Counsellors to be forced into the situation where they face huge liability issues or blatantly have to ignore the Act just to get their work done. This is probably not the intention of the draft bill.
The Portfolio Committee has already sourced written submissions in regard to the Bill and has now opened the floor to oral submissions at Parliament in regard to the Bill at the end of January. All are welcome to attend and listen in. You may wonder who will be presenting and when. Below we have listed the draft agenda for the 3 days of public hearings to help you decide on when you might like to attend.
DRAFT AGENDA
Date: Tuesday, 30 January 2018
Venue: Old Assembly Chamber, Ground Floor, Old Assembly Wing
Time: 09:00 – 16:45
| Time | Agenda |
|
09:00 – 09:02 |
Opening and Welcome |
|
09:02 – 09:04 |
Adoption of the Agenda |
|
09:04 – 09:05 |
Apologies |
|
09:05 – 09:45 |
Presentation by the Debt Counsellors Association of South Africa (DCASA) |
|
09:45 – 10:25 |
Presentation by the Association of Debt Recovery Agents (ADRA) |
|
10:25 – 11:05 |
Presentation by the Credit Bureau Association (CBA) |
| 11:05 – 11:15 | TEA |
|
11:15 – 11:55 |
Presentation by MicroFinance South Africa (MFSA) |
|
11:55 – 12:35 |
Presentation by Nedbank |
|
12:35 – 13:15 |
Presentation by the Agricultural Business Chamber (AgriBiz) |
| 13:15 – 14:00 | LUNCH |
|
14:00 – 14:40 |
Presentation by Prof M Kelly-Louw |
|
14:40 – 15:20 |
Presentation by Wonga |
|
15:20 – 16:00 |
Presentation by Michelle Barnardt |
|
16:00 – 16:40 |
Presentation by SAIPA |
|
16:40 – 16:45 |
Closing remarks/Way Forward |
Venue: Room V454, Fourth Floor, Old Assembly Wing
Date: Wednesday, 31 January 2018
Time: 09:00 – 16:10
| Time | Agenda |
| 09:00 – 09:02 | Opening and Welcome |
| 09:02 – 09:04 | Adoption of the Agenda |
| 09:04 – 09:05 | Apologies |
| 09:05 – 09:45 | Presentation by Summit Finance |
| 09:45 – 10:25 | Presentation by the Consumer Goods Council of SA (CGCSA) |
| 10:25 – 11:05 | Presentation by the National Clothing Retail Federation of SA (NCRFSA) |
| 11:05 – 11:15 | TEA |
| 11:15 – 11:55 | Presentation by the Banking Association South Africa (BASA) |
| 11:55 – 12:35 | Presentation by the Large Non-Bank Lender Association (LNBLA) |
| 12:35 – 13:15 | Presentation by Truworths |
| 13:15 – 14:00 | LUNCH |
| 14:00 – 14:40 | Presentation by the National Debt Counselling Association (NDCA) |
| 14:40 – 15:20 | Presentation by Finbond |
| 15:20 – 16:00 | Presentation by Yvonne Oberholster |
| 16:00 – 16:10 | Closing Remarks/Way Forward |
Date: Friday, 2 February 2018
Venue: Old Assembly Chamber Ground Floor, Old Assembly Wing
Time: 08:30 – 13:15
| Time | Agenda |
|
08:30 – 08:32 |
Opening and Welcome |
|
08:32 – 08:34 |
Adoption of the Agenda |
|
08:34 – 08:35 |
Apologies |
|
08:35 – 09:15 |
Presentation by Standard Bank |
|
09:15 – 09:55 |
COSATU |
|
09:55 – 10:55 |
Presentation by the Department of Trade and Industry |
| 10:55 -11:10 | TEA |
|
11:10 – 12:10 |
Presentation by the Department of Justice and Constitutional Development |
|
12:10 – 13:10 |
Presentation by National Treasury |
|
13:10 – 13:15 |
Closing remarks |
|
|
|
Remember if you want to attend you have to sign in at the Plein street public entrance and bring a copy of your ID (or drivers licence).