NCR red flag on Volkswagen Financial Services SA consumer credit fees | Fin24

NCR red flag on Volkswagen Financial Services SA consumer credit fees

Oct 24 2017 15:16
Carin Smith

Cape Town - The National Credit Regulator (NCR) has issued a Compliance Notice to Volkswagen Financial Services South Africa for charging consumers an on the road fee, admin fee and handling fee on credit agreements.

These fees are not permitted to be charged on credit agreements by the National Credit Act, the NCR said on Tuesday.  
The Compliance Notice instructs Volkswagen Financial Services SA to refund consumers and submit an audit report to the NCR.
“The National Credit Act allows consumers to be given a quotation which sets out the cost of credit before signing credit agreements. Consumers should request this quotation from their credit providers so that they can properly check the cost of credit that is being offered,” NCR CEO Nomsa Motshegare said in a statement.
The NCR said it will continue to conduct industry-wide investigations on the cost of credit "to root out illegal charges and fees" that consumers are charged.
It reminded credit providers that it is a criminal offence to charge consumers fees and charges that are prohibited by the National Credit Amendment Act of March 2014.

UPDATE: Volkswagen SA (VWSA) told Fin24 on Tuesday that it is aware of the compliance notice served on Volkswagen Financial Services by the NCR. Volkswagen Financial Services is, however, a separate legal entity from VWSA.

VWSA is, therefore, not in a position to respond to a compliance notice issued on a separate company over which it has no influence.

Volkswagen Financial Services has indicated that it does not agree with the allegations of the compliance notice and will comment in due course.

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