Want my money? Show me a statement
If you get a demand from any form of money lender or debt collector‚ you have the right to insist on a full statement of account‚ showing how that amount was arrived at.
The Credit Ombud's office has made public one of its recent cases to highlight the service it offers and drive home the "you have a right to ask for a statement" message.
Nomeko Thilizi* lodged a complaint with the Credit Ombud‚ asking whether the interest he was being charged on a R3‚000 loan over three months was correct.
He had paid three instalments when he lost his job and had asked for a settlement balance.
He was told he owed R543‚ due on July 31‚ 2015‚ and he paid it‚ on time.
But when he got his final statement‚ that payment didn't reflect and then began the harassing phone calls for further payment.
"The credit provider was adamant that the final payment hadn't been received‚" the Ombud's office said.
Acting as a mediator‚ the Ombud asked Thilizi to produce proof of payment‚ and the credit provider was asked to produce a statement of his account.
That statement – which had not been provided to Thilizi – showed that his payment was only credited to his account on August 17‚ almost three weeks after it was received‚ by which time interest and costs had accrued.
"We also found that the initiation fee that the credit provider charged was inflated and not in accordance with the prescriptions of the National Credit Act‚" the Credit Ombud said.
These discrepancies were brought to the credit provider's attention‚ but it seems they weren't willing to concede wrongdoing without a fight – or at least their lawyers weren't.
"There were numerous letters and telephone calls between the Credit Ombud and the attorneys representing the credit provider‚ but eventually they had to concede to have the balance written off‚ the account closed and a paid up letter furnished to the consumer."
If the Credit Ombud has a hard time getting justice‚ imagine how hard it is for "ordinary" consumers‚ most of whom don't know their rights.
- Protection against discrimination in respect of credit – a credit provider must not unfairly discriminate directly or indirectly against a person applying for credit.
- The right to be given reasons for credit being refused: on request from a consumer‚ a credit provider must advise a consumer‚ in writing‚ about the reason for refusing to enter into a credit agreement; offering a lower credit limit; refusing to increase a credit limit; or refusing to renew an expiring credit card or credit facility.
"Too few consumers know about this right to make use of it when they are denied credit‚" says Credit Ombud Nicky Lola Mohan.
"In most cases where consumers are declined credit‚ they immediately think it is a case of 'blacklisting'‚ which is not always the case."
- Right to information in an official language – a consumer has a right to receive any document that is required in terms of the National Credit Act (NCA) in an official language that the consumer reads or understands. Those who are not fluent in English could exercise this right‚ but unfortunately many don’t know about it and therefore they do not request the translated documents in their chosen language.
The Credit Ombud's office offers free help with credit agreements with non-bank credit providers‚ such as clothing and furniture retailers‚ as well as micro-lenders; fraudulent listings‚ emolument attachment orders ("garnishee orders") or general complaints about credit bureaux listings.
Contact: telephone number 0861 66 28 37; go to the website: www.creditombud.org.za; email firstname.lastname@example.org or send an SMS to 44786 and they will call you.
*not his real name
- Wendy Knowler is 'In Your Corner' as TimesLIVE's consumer champion. You can contact her on email: email@example.com or via Twitter: @wendyknowler