Blacklisted debtors may get amnesty

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BIANCA CAPAZORIO

Parliament is pushing hard for a proposed second credit amnesty, aimed at helping indebted South Africans remove themselves from credit providers’ blacklists.

Yesterday, the chairman of the select committee on trade and international relations, Dumi-sani Gamede, said “our goal as a committee is to get that amnesty” as a potential “legacy” to leave behind after they left Parliament.

The committee has previously expressed concern about South Africans not being able to access credit, even after settling their debts, because of blacklistings.

Research presented at the briefing by the Department of Trade and Industry and the National Credit Regulator yesterday showed that a credit amnesty, or the removal of negative credit data, could have positive effects.

The independent researchers’ conclusions state there is significant opposition from credit providers and credit bureaux to the removal of any credit information, but:

l It is possible to achieve a “marginal increase” in credit acceptance rates through a limited data removal exercise.

l And the removal of adverse information for amounts under R10 000 would benefit about 86 percent of those earning under R15 000 a month, and would assist them in obtaining home and micro loans.

And while the result around credit acceptance was marginal, National Credit Regulator chair-man Trevor Bailey said a credit amnesty could help increase employment opportunities for those whose records were wiped clean.

However, officials emphasised that the amnesty would not amount to writing off the debt, but rather to remove the blacklisting after debtors had paid it off.

They also indicated that a clear credit history was only one consideration when applying for credit.

Trade and Industry Department Deputy Director-General Zodwa Ntuli said the independent research was commissioned to explore possible alternatives to the amnesty as well as any unexpected outcomes.

The amnesty introduced in 2006 had shown little impact with only a 3.2 percent increase in accepted credit applications, she said.

“We don’t want to come back here in five years to ask for another amnesty,” she said.

Gamede said the first amnesty had “had some holes in it” and many applicants did not meet the requirements.

The recession had hit consumers hard, and other amnesties in the country had forgiven people for far worse transgressions, he said.

“If we look at other amnesties in South Africa (such as) the Truth and Reconciliation Commission, the consumers didn’t rob or kill anyone. We forgave people with illegal firearms and unroadworthy cars and last year we released people from prison,” he said.

Ntuli, however, emphasised that the findings of the researchers were not set in stone and that more discussion needed to take place before any of them were implemented.

The matter is due to come before the committee again within a month.


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