Durban - Durban professor Bonke Dumisa, who has been on the national consumer tribunal for the past 10 years, says consumers are drowning in debt, but KwaZulu-Natal residents are not vigilant enough about fighting for their rights.
He also said more people in trouble were asking for help to rearrange their debt and work their way out of financial difficulty.
Dumisa, who was the tribunal’s deputy chairman, was recently appointed as its acting executive chairman by Trade and Industry Minister Rob Davies.
Dumisa said most cases the tribunal dealt with came from the Western Cape and Gauteng, and KZN lagged behind.
“We go around the country sitting to hear cases and when we come to KwaZulu-Natal we are battling to get debt counsellors to bring cases to us, whereas when we go to Gauteng and the Western Cape, we have more cases than we can handle. It has got better, but it is still not as much as the other two provinces.”
The tribunal hears cases referred by the National Consumer Commission and the national credit regulator. It is an independent body which adjudicates on disputes over consumer credit.
Dumisa said more than 40% of South Africans were in financial difficulty. “You will find a person renting a property for R86 000 a month and driving a nice car but they want their debt to be rearranged.”
He believed that one of the reasons KZN consumers were lagging behind when it came to referring cases was because information about debt counsellors and the options available was mainly accessible on the internet.
“This is sad and many consumers are losing out because legislation is there to protect consumers.”
He said the tribunal had seen an upsurge in the number of cases for debt re-arrangement orders. “We used to have 5 000 orders a year. This year from March 2016 to now, there have been over 24 000 cases coming to us to deal with.”
He said these orders could help consumers pay off their debt. “In some cases the consumer pays 0% interest on their debt and the payment period is extended. People may question why a credit provider who has been charging interest of 32% would be willing to accept less, but they would rather get something then nothing.”
However, he added that debt arrangement orders would not be granted if one credit provider objected.
He said the tribunal had extensive powers and in one groundbreaking case had ordered a credit provider to pay back a consumer.
“A touching case involved a man from the Free State who had a VW and was battling to pay. He told the credit provider, and they told him to bring in the car and they would keep it for him. But instead of keeping the car, they auctioned it at a fraction of what he could get.
“He complained and the tribunal ruled that the bank should refund him the difference between the amount it fetched at auction and what he would have received if he had sold the car privately.”
Dumisa stressed that most credit providers were lawful, but a few took advantage of consumers.
Bonke Dumisa
The Mercury