What is a credit bureau?
• A
credit bureau is a company that gathers information and updates each consumer’s
credit history. A credit bureau creates a record of a consumer’s credit
information indicating how the consumer manages his/her credit.
• The
credit bureau supplies these records to credit providers, such as banks,
retailers and other credit providing companies.
• The
information indicates each consumer’s payment record.
• It
is also used to detect fraud, corruption or theft.
When I apply for credit from a credit provider, who
decides whether or not I qualify for credit?
• When
you apply for credit, the credit provider uses information received from a
credit bureau to assess your application.
• When
your credit record satisfies the standards of the credit provider, a decision
to grant you credit is made by the credit provider.
• It
is the bank, retailer or credit provider that approves or rejects the credit
application and not the credit bureau.
What does the Act do?
• The
Act stipulates that each credit bureau must register with the National Credit
Regulator in order to conduct business legally;
• It
sets out the purposes for which consumer credit information may be used, and
the companies to which the credit bureau may provide the information;
• It
sets out standards for data accuracy to ensure that information kept by a
credit bureau on your record is always accurate;
• It
ensures that each consumer has the right to check his or her record, and that
any mistakes are corrected.
Why you need to challenge your credit report
Most of the time the information on the credit bureaus is
incorrect.
• Accounts
balances on the Credit Bureaus are inflated
• Accounts
has reached Induplum - Despite
any provision of the common law or a credit agreement to the contrary, the
amounts contemplated in s 101(1)(b) to (g) that accrue during the time that a
consumer is in default under the credit agreement may not, in aggregate, exceed
the unpaid balance of the principal debt under that credit agreement as at the
time that the default occurs. Once the amounts referred to in s101(1)(b) – (g)
that accrue during the period of default, whether or not they are paid, equal
in aggregate the unpaid balance of the principal debt at the time the default
occurs, no further charges may be levied.
Section 101 – Interest, initiation
fee, service fee, credit insurance, default administration
charges, and collection
costs.
• Debt
has prescribed- 3 YEAR PRESCRIPTION
PERIOD APPLIES TO In short, according to the Prescription Act, if, in the past
three years you have not made any payment towards settling a debt, acknowledged
owing the debt in any way – including over the phone – agreed to pay it, or
been summonsed in respect of it, it has prescribed, and you can raise this as a
defense when asked to pay it. NOT ALL DEBT PRESCIBES IN THREE YEARS
• Judgements
are incorrect
• Wrong
credit scoring
• And
many more
Section NCA 70 (1)
• In
this section, “consumer credit information” means information concern-(a)
a person’s credit history, including applications for credit, credit
agreements to which the person is or has been a party, pattern of payment or
default under any such credit agreements, debt re-arrangement in terms of this
Act, incidence of enforcement actions with respect to any such credit
agreement, the circumstances of termination of any such credit agreement, and
related matters;
Questions
• How
does the Credit Bureaus know that the Handover amount to COLLECTION agency is
correct. (Induplum, Prescribed, Rule 42
of the NCA)
• This
will interfere with the consumers affordability
• Section
40 and 41 of the CPA may apply
• Section
72(c)(i)(ii) of the NCA
Section 70 (b) and (d)
• (b)
a person’s financial history, including the person’s past and current income,
assets and debts, and other matters within the scope of that person’s financial
means, prospects and obligations, as defined in section 78(3), and
related matters;
• (d)
a person’s identity, including the person’s name, date of birth, identity
number, marital status and family relationships, past and current addresses and
other contact details, and related matters.
Questions
• The
income does not show on the Bureau nor the marital status.
• Credit
Providers using this as an excuse when
they do the affordability assessment.
• Section
157 NCA- Applies
2 (c) and (h)and (i)
• C)
take reasonable steps to verify the accuracy of any consumer credit information
reported to it;
• H)not
draw a negative inference about, or issue a negative assessment of, a
person’s creditworthiness merely on the basis that the credit bureau has no
consumer credit information concerning that person; and
• I)not
knowingly or negligently provide a report to any person containing inaccurate
information
Questions
• How
does the bureaus verify the accuracy of the consumer information?
• EAOs
wrong Jurisdiction (Stellenbosch)
• Incorrect
interest and fees
• Cession
of debt and purchasing of books
• Registered
credit providers
• Handover
of debt to collecting agencies with inflating balances
• Updating
of the debt review statuses
Section 70 (5)
• For
the purpose of monitoring the consumer credit market to detect apparent
patterns of reckless credit granting and over-indebtedness, researching the
accessibility and use of credit by persons contemplated in section 13(a), and
otherwise exercising its mandate to research consumer credit issues and to
investigate and enforce compliance with this Act, the National Credit Regulator
may-
• (a)
require any credit bureau to provide periodic synoptic reports of
aggregate consumer credit information in the prescribed manner and form to the
National Credit Regulator, but any such report must not identify any particular
consumer or relate a particular consumer to any information so reported; and
• (b)
make further reasonable requests for information from a credit bureau
related to the information contemplated in paragraph (a); and (c)
analyse information provided to it under this section or section 69. the
prescribed standards;
• Sec
13. The National Credit Regulator is responsible to-(a) promote and support the
development, where the need exists, of a fair, transparent, competitive,
sustainable, responsible, efficient, effective and
• (i)
historically disadvantaged persons;
• (ii)
low income persons and communities; and
• (iii)
remote, isolated or low density populations and communities,
• in
a manner consistent with the purposes of this Act;
• The
bureau system won’t be able to assist in the first paragraph of sec 70(5) as
the information they are receiving from the credit market is incorrect
Section 72(3)
• (3) If a person has challenged the accuracy
of information proposed to be reported to a credit bureau or to the national
credit register, or held by a credit bureau or the national credit register,
the credit provider, credit bureau or national credit register, as the case may
be, must take reasonable steps to seek evidence in support of the challenged
information, and within the prescribed time after the filing of the challenge
must-
• (a)
provide a copy of any such
credible evidence to the person who filed the
• (b)
remove the information, and all
record of it, from its files, if it is unable to find credible evidence in
support of the information, challenge, or subject to subsection (6).
• (4) Within 20 business days after receiving a
copy of evidence in terms of subsection (3)(a), the person who challenged the
information held by a credit provider, credit bureau or national credit register
may apply in the prescribed manner and form to the National Credit Regulator to
investigate the disputed information as a complaint under section 136.
• (5)
A credit bureau or the National
Credit Register may not report information that is challenged until the
challenge has been resolved in terms of subsection (3)(a) or (b).
• (6)
On application by a credit provider,
credit bureau or the National Credit Regulator, as the case may be, the
Tribunal may make an order limiting the applicant’s obligations to a consumer in terms of this section if the
Tribunal is satisfied that the consumer’s-
• (a)
particular request or
requirement is frivolous, unfounded or wholly unreasonable;
• or (6) history and pattern of such requests or requirements are
frivolous or vexatious.
• (7) Failure by a credit bureau to comply
with a notice issued in terms of section 55,
in relation to this section, is an offence.
