The National Credit Regulator (NCR) has issued a compliance notice to Volkswagen Financial Services South Africa (Pty) Ltd for charging consumers an on the road fee‚ admin fee and handling fee on credit agreements.
"These fees are not permitted to be charged on credit agreements by the National Credit Act‚" said a statement by the NCR's Lebogang Selibi on Tuesday.
The compliance notice has instructed Volkswagen Financial Services South Africa to refund consumers and submit an audit report to the NCR.
"The National Credit Act allows consumers to be given a quotation which sets out the cost of credit before signing credit agreements. Consumers should request this quotation from their credit providers so that they can properly check the cost of credit that is being offered‚" said NCR CEO Nomsa Motshegare.
Consumer journalist Wendy Knowler reported on TimesLIVE earlier in October that dealerships had for years got away with what an industry insider once conceded was "overzealous padding" in the form of the on-the-road fee‚ justifying it as the cost of "preparing" vehicles for sale.
The National Credit Act only allows for an initiation fee‚ extended warranty‚ delivery‚ initial fuelling and licence or registration fees to be added to a credit agreement.
The NCR earlier issued BMW Financial Services with a compliance notice‚ saying customers should be refunded for the "on-the-road" fees added to their credit agreements.
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