Fincheck got some insight from the great minds at Credit Ombud. This interview provides information around consumer credit, protecting yourself and if need be, finding help when you have fallen victim to online fraud,
What and who is the Credit Ombud
The Office of the Credit Ombud resolves complaints from consumers and businesses that are negatively impacted by credit bureau information or when a consumer has a dispute with a non-bank credit provider.
Explain, briefly how Credit Ombud benefits the user - what is in it for the individual user?
The Credit Ombud offers consumers a free dispute resolution service. The mission of the office is to:
- Effectively resolve disputes between members of the credit industry and credit receivers (consumers and businesses) relating to credit and credit information.
- Act as an educator to the public in matters pertaining to the credit industry.
- At all times the Ombud will act honestly, independently and fairly; balancing the rights of all parties.
Companies like Fincheck are there to create transparency around the financial sector. Do you find that lenders take advantage of borrowers in the form of muscling them around?
From complaints received at the Credit Ombud, we have found that many times it is the case of ignorance and desperation on the part of a consumer that lends the situation open to what may possibly perceived by consumers as “muscling tactics.” This is one of the reasons that the NCA was implemented. However, notwithstanding the implementation of the Act, additional measures needed to be put in place, resulting in the amendment to the Act which was published last year, for example to curb over indebtedness and reckless credit.
With a great amount of the SA population feeling the pinch of higher living costs, do you find more borrowers coming into conflict with their lenders?
Yes. Now as consumers face tough times ahead with hikes on essentials such as food and electricity as well as interest rates, this results in non payment or short payment of accounts which leads to consumers being handed over to collection agencies or lawyers. The effect of this is that consumers are now not only held liable for the balance outstanding but also; interest and other costs that have accrued on the account. Our office have already received a number of complaints and queries from consumers wanting assistance as to know they should handle this.
It is difficult as an individual to stand up to a bank, or any company for that matter. What is the first port of call for an individual who feels they being wrongfully charged by their lender?
Financial institutions and credit providers generally have a complaints resolution process which they require a consumer follow. A consumer is at first, urged to try to resolve their complaint with the credit/ service provider or credit bureau concerned. If the consumer is still unhappy, or does not get a response to their complaint within twenty (20) working days, they can then approach us.
What are the main credit rights a consumer has?
- Right to apply for credit – Every adult person has a right to apply to a credit provider for credit. Being granted the credit is however not an automatic right as it is based on your credit health.
- Protection against discrimination in respect of credit – A credit provider must not unfairly discriminate directly or indirectly against a person applying for credit.
- Right to reasons for credit being refused - On request from a consumer, a credit provider must advise a consumer 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 if it when they are denied credit.
- 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 e.g. Consumers who are not fluent in English could exercise this right, but unfortunately they don’t know about it and therefore they do not request the translated documents in their chosen language.
- Right to receive documents – Every document that is required to be delivered to a consumer in terms of the NCA must be delivered either in person at the business premises of the credit provider by ordinary mail; prepaid registered post; fax; email; or printable web-page.
Do you offer relief and assistance over all these areas?
Yes, in accordance to our Jurisdiction we are able to assist consumers in all the above areas.
What is the best way for an individual to get in touch with you?
Consumers can contact the office of the Credit Ombud via email firstname.lastname@example.org or 0861 66 28 37 if they would like to get more information on arranging free consumer education workshops or should they require any assistance in dealing with disputes with credit grantors and credit bureaus. Consumers can also sms our office on 44786 and one of our consultants will you back.
Do you believe individuals need to do more research into which lender will best accommodate their needs?
Consumers most definitely need to do research into credit providers before they go out and sign contracts. Many consumers aren’t aware that they are able to obtain a quote when requesting credit and that this quote is valid for 5 business days. Consumers should use this time to shop around for the best possible interest rate before making a final decision. Consumers in this country are still very much uninformed and it is an ongoing, impossibly huge task to get the knowledge about a piece of very complicated legislation out there to the general population. You can imagine that the poor, uneducated or desperate consumers are more vulnerable than some professional person who understands his/her rights. If in doubt, it is always recommended that the consumer approach someone well-informed to provide assistance.