Publications
Partners
Cape Town - South African consumers seem to be very confused about the implementation of the credit amnesty on April 1.
According to the credit bureau TransUnion its call centre has received an inordinate number of calls from confused South African consumers since the implementation of the amnesty.
Tersia van Rooyen, TransUnion's manager responsible for consumer education, the call centre is fielding thousands of calls every day, with most callers confused about the terms of the amnesty.
Among the most frequently asked questions are how do I apply for amnesty, why debts incurred before April 1 are still reflected on credit reports and why credit reports still reflect "negative information".
TransUnion provided some clarification:
It is not necessary to apply for amnesty. The terms of the credit amnesty will be applied automatically to anyone who has negative information or a paid-up judgment reflected on their credit reports prior to April 1 2014.
The credit amnesty does not remove a consumer’s obligation to repay a debt incurred prior to April 1 2014.
All the amnesty has done is to remove the negative information that was reflected on consumers’ credit reports before April 1 2014.
In terms of the credit amnesty, consumers still have to repay all their debts.
The only negative information to be removed from consumers’ credit records includes negative classifications of consumer behaviour (including “delinquent”, “slow paying”, “absconded”, or “not contactable”) and negative classifications of enforcement actions (including “handed over for collection or recovery”, “repossessed”, “revoked”, any “legal action”, or “write off” of the debt).
However, any negative classifications of consumer behaviour or enforcement actions that occurred after April 1 2014, will still reflect on a consumer’s credit report in the future.
In addition, consumers’ credit reports will continue to reflect all payment behaviour - that is your monthly repayments of any debt - that took place before 1 April, 2014.
Judgments
There’s another aspect to the credit amnesty consumers should be aware of, said TransUnion.
The credit amnesty also affects the way in which information about judgments is handled by credit bureaus.
From June 1 2014 paid up judgments will be automatically removed from credit bureaus’ records.
In the past, this judgment information would remain on a consumer’s credit report for five years, even if the debt had been paid.
Previously a consumer would have had to obtain a court order to have this information removed from their credit report.
From June 1 2014, the judgment will be removed once it has been paid.
Every consumer has a right to their Free Credit Report once every 12 months from each of the credit bureaus.
According to the credit bureau TransUnion its call centre has received an inordinate number of calls from confused South African consumers since the implementation of the amnesty.
Tersia van Rooyen, TransUnion's manager responsible for consumer education, the call centre is fielding thousands of calls every day, with most callers confused about the terms of the amnesty.
Among the most frequently asked questions are how do I apply for amnesty, why debts incurred before April 1 are still reflected on credit reports and why credit reports still reflect "negative information".
TransUnion provided some clarification:
It is not necessary to apply for amnesty. The terms of the credit amnesty will be applied automatically to anyone who has negative information or a paid-up judgment reflected on their credit reports prior to April 1 2014.
The credit amnesty does not remove a consumer’s obligation to repay a debt incurred prior to April 1 2014.
All the amnesty has done is to remove the negative information that was reflected on consumers’ credit reports before April 1 2014.
In terms of the credit amnesty, consumers still have to repay all their debts.
The only negative information to be removed from consumers’ credit records includes negative classifications of consumer behaviour (including “delinquent”, “slow paying”, “absconded”, or “not contactable”) and negative classifications of enforcement actions (including “handed over for collection or recovery”, “repossessed”, “revoked”, any “legal action”, or “write off” of the debt).
However, any negative classifications of consumer behaviour or enforcement actions that occurred after April 1 2014, will still reflect on a consumer’s credit report in the future.
In addition, consumers’ credit reports will continue to reflect all payment behaviour - that is your monthly repayments of any debt - that took place before 1 April, 2014.
Judgments
There’s another aspect to the credit amnesty consumers should be aware of, said TransUnion.
The credit amnesty also affects the way in which information about judgments is handled by credit bureaus.
From June 1 2014 paid up judgments will be automatically removed from credit bureaus’ records.
In the past, this judgment information would remain on a consumer’s credit report for five years, even if the debt had been paid.
Previously a consumer would have had to obtain a court order to have this information removed from their credit report.
From June 1 2014, the judgment will be removed once it has been paid.
Every consumer has a right to their Free Credit Report once every 12 months from each of the credit bureaus.
