Johannesburg - Industry players launched a new drive to promote a better understanding of debt counselling on Wednesday, as the process has until now not managed to achieve its aims.
Conducted by the Banking Association of SA (Basa), the National Credit Regulator (NCR) and the Debt Counselling Association of SA (DCASA), it aims to "address adverse consumer behaviour trends as well as promote a better understanding of debt counselling, including expected conduct by consumers".
Two target audiences had been identified for the campaign - consumers who were debt-stressed but not yet under debt review, and those already under review.
The debt management campaign, which had cost about R8m, had come about because debt counselling at present was not achieving its aims, as outlined in the National Credit Act, said Johan de Ridder of African Bank and campaign spokesperson for the banks.
"Limited cases are being resolved and there are high levels of default by people getting counselling."
He said that about 7 000 consumers, with about nine credit agreements each, were applying for debt counselling every month.
"To date, the debt review process has not resulted in the majority of the approximately 185 000 applications being resolved successfully," said De Ridder. "Non-paying consumers under debt counselling run a risk of having their debt review process terminated and they may lose their assets and all protection afforded in terms of the Act."
De Ridder said a team from the NCR had identified the causes and possible solutions and these were being implemented.
It was crucial that consumers be made aware of the options available to address over-indebtedness, he said, adding consumers should also first contact their banks before applying for debt counselling.
The campaign also aimed to inform consumers already under debt review and not making any repayments of the consequences they faced.
The campaign would give debt-stressed consumers several options.
They could use the National Debt Mediation Association's (NDMA) call centre for preliminary advice, or use an SMS service which would provide them with the necessary contact numbers.
Consumers could also visit the NCR's micro or mobi site.Showing empathy
"There will be press advertising in two languages and radio advertising in seven languages," De Ridder said, adding that all advertisements would aim to be empathetic towards consumers.
There were presently around 100 000 consumers under debt review, but only 57 000 made regular payments.
The NDMA's CEO Magauta Mphahlele told the briefing that empathy was the core of the campaign.
"Because of the negative connotations associated with debt people are not open to talk about their problems and the campaign wants to address that," she said. "We won't adopt a judgmental type of approach because sometimes things happen to people that are beyond their control."
She said the call centre had already been in existence for two years and was "quite ready" to take an influx of calls.
The campaign, which is funded by Absa, African Bank, Capitec, First Rand Nedbank and Standard Bank, will run until December 19.
Asked why the campaign could not be sustained beyond that date, De Ridder said an assessment would be made and it would be decided if there was merit in taking the campaign forward.