Parliament, Friday, 7 September 2018 – The Portfolio Committee on Trade and Industry has adopted the National Credit Amendment Bill.
The Chairperson of the committee, Ms Joanmariae Fubbs said, the Bill which was adopted on Wednesday, 5 September 2018 will provide relief to over-indebted South Africans who have no other effective or efficient options to extract themselves from over-indebtedness. The Bill will for the first time in South Africa, address the plight of the poor and low-income worker who is over-indebted. The Bill also encourages and enforces responsible lending and borrowing.
“This Bill will strengthen the National Credit Amendment Act which enabled South Africa to withstand the worst effects of the global financial meltdown in 2008,” said Ms Fubbs. The Bill also provides measures to deal with the debt of those earning R7 500 or less.
The courts will not be overcrowded as the majority of the applicants will go through the National Consumer Tribunal (NTC). Secondly Credit Providers will be invited to participate right up until the final order is given by the NTC. Thirdly magistrates will be empowered to deal effectively with illegal lenders as the failure to register has been made an offence
The Bill distinguishes between secured and unsecured credit. Essentially this Bill addresses a critical gap in the current legislation and that is to provide urgent debt relief to people who are not currently covered by the insolvency systems, which include sequestration or administration. Currently debt counsellors do not provide a service for people earning less than or equal to R7 500 as this is not “cost-effective”.
Finally, Ms Fubbs said, debt will only be extinguished after all other measures have been exhausted.
With respect to Ministerial powers, the Minister can adjust the gross income and the amount of unsecured debt in line with inflation. Regulations will provide for credit life insurance on all loans of more than six months and less than or equal to R50 000. The Bill has been submitted to the National Assembly for its consideration. A debate on the Bill has been scheduled for Wednesday, 12 September 2018.
ISSUED BY PARLIAMENTARY COMMUNICATION SERVICES ON BEHALF OF THE CHAIRPERSON OF THE PORTFOLIO COMMITTEE ON TRADE & INDUSTRY, MS JOANMARIAE FUBBS
For media enquiries or interviews with the Chairperson, please contact the Committee’s Media Officer:
Name: Rajaa Azzakani (Ms)
Tel: 021 403 8437
Cell: 081 703 9542
E-mail: razzakani@parliament.gov.za
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