What does the bill mean for overindebted South Africans?
Also referred to as the ‘Debt Intervention Bill’, the new piece of legislation has been tailored to provide relief to low-income workers, in particular those who fall within the <R7500 income bracket.
The first step of the intervention process involves restructuring and giving consumers five years to pay off their debt. In cases where certain individuals are found to be critically indebted, it could also lead to the extinguishing of debt.
To be considered for this write-off, the following criteria will apply: The debt in question cannot exceed R50 000.
The unsecured debt had to have been accrued by means of unsecured credit agreements, unsecured short-term credit transactions or unsecured credit facilities.
The indebted consumer had earned no more than R7500 per month over the prior 6 months. In accordance with the bill, debt counsellors and businesses like Libertine Consultants will also be expected to report suspected reckless lending by financial service providers. This will be done in a bid to curb the reckless extension of credit by these institutions.
SA consumers cautioned to play by the rules
However, the act has also put in place new restrictions on the consumer. It will now be a criminal offence to intentionally submit false information relating to debt intervention. A person who alters their financial circumstances, or a couple who does so jointly, in order to qualify for debt forgiveness or intervention of any kind will also be liable for prosecution.
Find out more about the Credit Amendment Bill Act No 7 of 2019
Would you like to find out whether you would be eligible for debt relief as it pertains to the National Credit Amendment Bill Act No 7 of 2019? Get in touch with a Libertine Consultants representative. Our seasoned team of debt counsellors are on hand to provide you with expert advice and tell you more about our established rage of debt services and credit services. Together we can pave the way to a more prosperous future for you and your family.