Credit ombud resolves more cases

Johannesburg - The Credit Ombud resolved 40% more cases in 2011 compared to the year before, its annual report released on Tuesday shows.

"Total disputes closed increased 39% across all departments, reaching 4943," the ombud said in a statement.

Credit Ombud Manie van Schalkwyk said the office received 14 167 complaints and enquiries between January and December 2011.

"We recovered a total of R2.4m for complainants and found in favour of consumers 53% of the time," he said.

The ombud deals with complaints about credit information, debt counselling and non-bank credit disputes.

It took on average 41 days to finalise a dispute, at a cost of R1 896 a dispute.

Van Schalkwyk said there had been a 212% increase in the number of non-bank credit disputes in 2011. The significant increase was off a low base as it was only the second year of operation for this department.

This included credit agreements for clothing, retail and furniture accounts, as well as loans from microlenders and credit providers which were not banks.

The ombud finalised 1 337 disputes.

"The major concern in the area of non-bank credit is in terms of statements, where payments are misallocated or statements are not forthcoming from credit providers," said Van Schalkwyk.

The ombud resolved 3192 credit information disputes in 2011 - a 2% increase on 2010.

Van Schalkwyk was concerned that monthly payment profile records were not being updated by credit providers and rescinded judgments remained on the credit bureaux.

"One reason for the delay in updating judgment information is that fraudulent rescission documents are being produced by consumers and the credit bureaux are having to be more vigilant in investigating these.

"As a result, credit bureaux are taking longer than the required 20 working days to update their records."

The credit ombud launched a department to handle debt counselling disputes in April 2011. By the end of the year it had finalised 414 such disputes.

"We receive the more intricate and complicated matters that require an in-depth and comprehensive investigation, as well as urgent matters where a sale in execution or a repossession is imminent," Van Schalkwyk said.

The ombud had managed to stop a number of sales in execution and repossessions, he said.

In December 2011 there were 19.34 million credit active consumers in the country, and 46% of them had impaired credit records, according to the annual report.

An impaired record means the consumer has three or more payments in arrears, or has an adverse listing, or has a judgment or administration order against their name.