Data provided by iNet BFA
Loading...
See More

Banks owed R1bn - report

Feb 09 2012 08:33 Sapa

Related Articles

Banks move into Mzansi market

Most in SA don't qualify for home loans

Nedbank offers hi-tech debt monitoring

Poor snub Mzansi account

Credit card fraud almost doubles

Debt review woes

 

Johannesburg - South Africans owe banking institutions an estimated R1bn, the Banking Association of SA has said in court papers, according to a report on Thursday.

This debt was contained in more than 38 million credit accounts tallied by banks from January to September 2011, the association said in papers submitted to the Constitutional Court on Wednesday.

Beeld newspaper reported that the banking association asked the Constitutional Court to define the word "receive" for the purposes of section 129 of the National Credit Act.

Section 129 stipulates that creditors, including banks, have to notify debtors in writing that they are overdue and that legal action could follow.

For the purposes of this section, it was assumed that a debtor "received" a notification if the creditor sent it to the debtor's chosen address.

However, in practice many debtors did not receive the notice because they changed address after borrowing the money.

This situation prompted the Institute for Socio-Economic Rights (ISER) to ask the Constitutional Court to make a ruling that a creditor must be able to prove in court that a debtor had received a notice of arrears.

The banking association has countered that this would cost banks hundreds of millions of rand a year.

The association wants the case referred to a high court, to allow for testimony about the far-reaching, damaging consequences of changes to section 129.

 
banks  |  debt
NEXT ON FIN24X

 
 
 

Read Fin24’s Comments Policy

24.com publishes all comments posted on articles provided that they adhere to our Comments Policy. Should you wish to report a comment for editorial review, please do so by clicking the 'Report Comment' button to the right of each comment.

Comment on this story
14 comments
Add your comment
Comment 0 characters remaining
 

Company Snapshot

We're talking about:

Small Business

A cash flow crunch often occurs in small businesses trying to balance cash coming in with cash going out. Watch this video to help you improve.
 
 

Retirees regret living it up in days gone by

Many people only realise when it is too late that the money they splashed out on pricey cars and holidays should have been saved for a cushy retirement instead.

 
 

Start saving...

Time the key for retirement saving
Dummy's guide to saving
Save money with affordable account
All about endowments

Money Clinic

Money Clinic
Do you have a question about your finances? We'll get an expert opinion.
Click here...
Loading...