NCR Appeal to the SCA Over Edcon Club Fees
The long-running war between the National Credit Regulator and Edcon (and several other credit providers) over club fees seems set to enter yet another phase as the NCR has applied to the Supreme Court of Appeal to try and overturn the recent High Court ruling over Club Fees which went in favour of Edcon.
The recent ruling came after years and years of the NCR trying to get Edcon to pay back Billions in club fees to consumers because these fees are not specifically mentioned in the National Credit Act and regulations. Edcon argue that because consumers can chose to join or leave the club at any time these fees have nothing to do with the cost of credit.
‘these fees are not specifically mentioned in the National Credit Act and regulations’
The NCR have invested a lot of energy and reputation into the battle and look set to take the matter as far as they can to try to secure a win and clarity on whether credit providers (and by extension other registrants) can charge any fees not specifically mentioned in the National Credit Act and Regulations. This is of interest to the industry for a variety of reasons.
For example, the National Credit Act and Regulations only mention a small amount of R50 in regard to debt counselling. This complex and involved legal process requires many hours of hard work and effort by trained and registered professionals. Though the NCR has suggested some fee options these have never been added into law or regulation. Thus the industry could be charging fees that are not allowed (any fees whatsoever other than the R50) at the prompting of the Regulator among other parties.
Clarity on the topic will help shape the way forward for many in the industry and decide the future of Edcon.