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Credit Bureau regulations and your rights

The Credit Bureau Regulations and Your Rights


Background
The National Credit Act 34/2005 (NCA) and the National Credit Regulator (NCR) became operational on 2 June 2006. The National Credit Regulator is responsible for the enforcement of the Act.
What is a credit bureau?
A credit bureau is a company that gathers information and updates each consumer's credit history. A credit bureau creates a record of a consumer's credit information indicating hoe the consumer manages his/her credit.
The credit bureau supplies these records to credit providers, such as banks, retailers and other credit providing companies. The information indicates each consumer's record. It is also used to detect fraud, corruption or theft.
What does the Act do?
• The Act stipulates that each credit bureau must register with the National Credit Regulator in order to conduct business legally;
• It sets out the purposes for which consumer credit information may be used, and the companies to which the credit bureau may provide the information;
• It sets out standards for data accuracy to ensure that information kept by the credit bureau on your record is always accurate;
• It ensures that each consumer has the right to check his or her record, and that any mistakes are corrected.
What rights do I have?
You have the right:
• To be informed that the credit provider intends to report negative information on you to a credit bureau before the credit provider actually reports you;
• To receive a copy of your credit record from a credit bureau when you request it. You can get one free record per year, but the credit bureau may charge you a fee for any further records;
• To challenge information kept by the credit bureau if you are unhappy with the information;
• For your information to be used only for purposes allowed by the Act.
Credit bureaux may not list information that may be discriminatory such as information on race, sexuality, political affiliation, medical status, religion or membership with a trade union.
What can my credit information be used for?
Your credit information can be used:
• To asses whether or not you can afford credit;
• To investigate fraud, corruption or theft;
• To consider you for employment in a position that requires trust and honesty and entails the handling of cash or finances; and
• To assess whether or not you can afford various services.
Credit information assists credit providers to assess if consumers will be able to meet their financial obligations. Credit information is of benefit to consumers who are not over-indebted and have good payment history's. Credit information assists such consumers to get credit, and prevents them from becoming over-indebted.
Will I be notified before the information is sent to the bureau?
For the following information, you will receive 20 business days notice before a credit provider submits your information to a credit bureau. During this period, you must inform the credit provider or credit bureau if the information is incorrect:
• Classifications of consumer behaviour, such as 'delinquent', 'default', 'slow paying', 'absconded' or 'not contactable';
• Classifications related to enforce action taken by the credit provider, such as handed over for collection or recovery, legal action, or write off.
How can I verify that the information held by credit bureaux is accurate?
You can verify that the information held by a credit bureau is correct by following the steps below:
• Contact the credit bureau;
• Ensure that you have your accurate personal information such as your ID number and your address;
• The bureau will send you a form to complete;
• Complete the form and fax it to the bureau;
• The credit bureau may ask you to pay a fee; this must not exceed R20;
• Inform the bureau if there is any inaccurate information on your record, or ask the bureau to explain any information where you are uncertain.
Can I challenge information kept by credit bureaux if I don't agree with it?
YES! if you do not agree with the information held by the credit bureau, you challenge this and request the bureau to correct the information. If they refuse to correct the information, you can complain to the National Credit Regulator.
Who is the National Credit Regulator?
The National Credit Regulator is also responsible for the regulation of the South African credit industry. It has to:
• implement education campaigns;
• conduct research and develop policies;
• investigate complaints; and
• ensure compliance with the Act.
It also has the responsibility to register and regulate:
• credit providers
• credit bureaux; and
• debt counsellors.
The National Consumer Tribunal
The National Consumer Tribunal hears cases on non compliance with the Act, issues fins and provides redress to consumers. Consumers and credit providers may appeal to the Tribunal against any decision of the National Credit Regulator.
The Tribunal is a separate institution that is independent of the National Credit Regulator. The Tribunal consists of a chairperson and at least ten other members.
How long can credit bureaux keep my information?
Categories of Consumer Credit information Maximum Period
Details and results of disputes lodged by consumers
Number and nature of complaints lodge and whether complaint was
rejected. No information may be displayed on complaints that were
upheld. Eighteen months
Enquiries
Number of enquiries made on a consumer's record, including the name
of the entity/ the person who made the query and a contact person, if
available Two years
Payment profile
Factual information pertaining to the payment profile of the consumer. Five years
Adverse classifications of consumer behaviour
Subjective classifications of the consumer behaviour One year
Debt restructuring
As per section 86 of the Act, an order given by the Court or Tribunal Until a clearance certificate
is issued
Civil court judgments
Civil court judgments including default judgment The earlier of 5 years or until
the judgement is rescinded by
a court abandoned by the credit
provider or terms of section 86
of the in Magistrates' Courts Act,
32 of 1944
Administration orders
As per the court order The earlier of ten years or until
order is rescinded by a court
Liquidations
As per court order Unlimited period
Rehabilitation orders
As per court order 5 years
Other information
Any other information not included in any category above  2 years
How can I report a complaint?
There are three steps to effective complaint solving. Follow these steps and your complaints will be addressed.
Step one
Contact your credit bureau:
Credit bureaus receive credit information from credit providers. They keep a record of of your credit history and they can help you correct information that is not accurate.
If your complaint has not been resolved, proceed to step two.
Step Two
Contact the office of the Credit Information Ombud.
The Credit information Ombud can request the credit bureau to address your complaint and ensure that your complaint is resolved.
If you are still not satisfied, proceed to step three.
Step Three
Contact the NCR
The NCR has a legal mandate to regulate credit bureaux and their business conduct.

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