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Capfin face Deregistration over Reckless Lending

 

The National Credit Regulator (NCR) announced that they have made an application to the National Consumer Tribunal (NCT)  to cancel the registration of Southern View Finance /trading as Capfin.

The application to the NCT  follows an investigation last year into Capfin’s lending practices, after a series of adverts promoting credit from Capfin stated that consumer need only bring their ID to apply for a loan. The NCR then investigated and issued Capfin with a notice to comply with the NCA and rectify the situation.

 

Read More Here: https://debtfreedigi.co.za/capfin-get-compliance-notice-warning-ncr/

 

Capfin’s Legal team are quoted to have said:”“Capfin is confident that its processes” and their “procedures comply fully with the provisions of the NCA,”. It seems, however that the NCR are unsatisfied with Capfin’s response to the compliance notice and are now asking the NCT to take drastic action. The main point of concern is the granting of reckless credit following poor evaluation practices. Reckless credit is where a creditor gives consumers credit they cant afford or do not understand the terms and conditions thereof.

Problems

In many cases the NCR say that Capfin did not require any proof of income from consumers when making applications, does not keep any record of their affordability assessments and have expressed concern that Capfin’s advertising is misleading. [more about that topic in the February Debtfree DIGI Mag]. In the past when faced with similar charges African Bank were able to reach a settlement agreement with the NCR and saw the application to the NCT withdrawn.

 

Too Fast, NCR too Furious

The NCR are pushing hard to make an example of creditors who are not applying the standards as set out in the NCA. Perhaps Capfin were too fast to offer credit and made it a bit too easy?