Debtfree Magazine November 2017 by Debtfree Magazine

South Africaâ&#x20AC;&#x2122;s debt counselling magazine

ARE YOU WORKING

WITH YOUR

PDA? November 2017 www.debtfreedigi.co.za

What you can expect from Hyphen PDA: • Increased Debt Counsellor Profitability • Flawless Systems • Meaningful Reporting • Contented Consumers!

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Chris van der Straaten, Head: PDA 082 557 0437

Malcom Povey, Head: Operations PDA 082 445 5604

Don’t expect to hear an endless amount of “spin” around why things failed!.

Summer is finally here. You can probably taste the end of year break already. Schools are wrapping up exams and kids are looking forward to the summer holidays. People at work are starting to discuss their plans making a you jealous (‘don’t be a travel hater’). Magazines are advertising ‘5 ways to get bikini fit in only 10 days’ and ‘the fastest ways to lose that winter gut’. There is a growing feeling that the holidays are just around the corner. It’s hard not to be swept up in the excitement.

derail a well planned debt review. Make sure that this doesn’t happen to you. And if you are hovering on the borderline thinking about debt review - don’t delude yourself into thinking that your bonus cheque is miraculously going to turn things around and save the day. It’s time to get realistic and think long term. It could be the best gift you ever give yourself. One of the main goals of debt review is not just to get a person back to the bare minimum of monthly financial survival so this month we ask if debt review is making you a more savvy consumer. Will you leave the process with good financial understanding and habits? This is the debt ‘counselling’ aspect of the process that is often overlooked. Debt Counsellors can help you to help yourself grow as a consumer to educate yourself.

It’s not all fun and games though. The end of the year can be one of the most financially stressful for families. Particularly families under debt review who have to stick to a budget. December is often a month We also have interviews, industry of financial recklessness and poor related news and reviews, as well decision making and can quickly as a look at an important court case

about debt review. All these articles are designed to help educate you as a consumer as to what is going on in the industry and help you gain a holistic view of the entire process. Debt Counsellors can also check out the DC associations’ notice board for announcements and may also be interested in the new project launched by Debt Counselling Community Support. With December rolling around you will have to be smart if you want to stay in debt review and make a success of the process. It may require that you be smarter than ever before. But that’s the goal isn’t it. To be smarter than last year. So if you want something to fixate on, something to taste on the tip of your tongue then rather than stress about losing those last 5 kgs so you can squeeze into that old speedo of yours, why not rather think about being totally debt free.

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ARE YOU WORKING WITH YOUR PDA?

COURT MATTERS

ARE YOU READY FOR DECEMBER?

NEWS

MEERKAT PROFILE

SERVICE DIRECTORY

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C O N T E N T S

ARE YOU WORKING WITH YOUR PDA? Before entering debt review it is common for consumers to miss payments one month, and then make them the next. Some consumers would head over to an ATM or into a store to make payments intermittently whenever the collections calls became too much. Normally the creditor who shouted the loudest got paid first.

â&#x20AC;&#x153;

Half of all credit users are several months behind on at least one if not many different accounts.

â&#x20AC;?

ARE YOU WORKING WITH YOUR PDA?

It would be fair to say that consistency of payments across all accounts has not been a priority for most financially stressed consumers in South Africa. The debt review process is totally different however. Fundamental to the process are regular monthly payments or set amounts (that change and cascade over time) that are never missed. The right payment, needs to go to the right account on the right day. To make things even more complicated many banks change internal reference numbers on debt review accounts. Payments made into the ‘old’ account, using the old details will go unallocated for a long time allowing accounting differences to build up undetected for a few months. After some time the bank may even think the consumer is not paying the debt as a result of these internal reference changes. Eventually the creditor may make contact and say: ”where is our money”?

ARE YOU WORKING WITH YOUR PDA?

YOU DONâ&#x20AC;&#x2122;T HAVE TO USE A PDA Consumers can pay the restructured debt themselves (and make a separate payment for the Debt Counsellorâ&#x20AC;&#x2122;s fee) each month. The National Credit Act makes provision for this. Many financially able people choose to do so. Baring in mind that, they should stick exactly to the cascading payment plan and keep excellent record of each transaction through the years. It can be tricky ensuring that the payments are done timeously and keeping proof which they should forward to their Debt Counsellors each month. These records will be vital when trying to reconcile the balances with the bank each month (or couple of months) and in case of disputes. Consumers must also pay the exact right amount to the right accounts each month (as they shift and change over time according to the repayment plan). For most consumers who have been struggling to make their obligatory monthly debt payments over many years, this is realistically out of reach for them. What then?

ARE YOU WORKING WITH YOUR PDA?

MOST PEOPLE USE A PDA Fortunately the NCA also allows consumers to make use of a National Credit Regulator registered Payment Distribution Agency (PDA). This allows them to make a single payment to one account each month and then letting the PDA handle the rest and report back to them. For many, this is a real relief after all the stress of trying to rob Peter to pay Paul each month and not even wanting to open their bills from credit providers. No complicated schedule of vital payments rather just one easy payment. The consumer makes use of this service provider, perhaps at the suggestion of their Debt Counsellor, to simplify their lives. The majority of consumers under debt review make use of a PDA to help with their payments.

ARE YOU WORKING WITH YOUR PDA?

WORK WITH YOUR PDA When using a PDA, the consumer makes their one monthly payment and can then relax but there are things you can do to make working with a PDA more successful. We spoke to the various PDASA members and asked them for tips and advice which can help their clients. Here are some of the top things to keep in mind.

Clive Pintusewitz, CEO of the DCM Group says... Consumers should stay actively involved with the debt review process and make sure annual reviews are done (a check in with your Debt Counsellor to see if your situation has changed dramatically). He says that consumers should insist on a high level of service from their Debt Counsellors and should learn their Debt Counsellors internal complain and enquiry escalation process so that they can get answers to their questions and complaints speedily. He further says that consumers should compare the statements they get from their PDA with the statements from their credit providers and make sure that every creditor is getting and showing the payments received.

ARE YOU WORKING WITH YOUR PDA?

Chris Van Der Straaten of Hyphen PDA says ... Some of the most important things are the simplest. For example, he says that many consumers don’t even know who their actual Debt Counsellor is (this can be true when dealing with large firms with many staff and many different DCs). He advises storing your Debt Counsellor’s number in your phone, pasting it to your fridge and putting it in the cubbyhole of your car. He points out that it is a more important contact number to have than that of your mother-in-law or the local DVD store. More than that, he also advises learning the physical location of the Debt Counsellor’s office and making a note of it. Why not go visit the office if possible?

ARE YOU WORKING WITH YOUR PDA?

Herman Joubert of DC Partner says... Many times when consumers send correspondence to their PDA they forget to take the basic step of adding their ID number to their emails. After all, there may be more than one John or Vuyani who makes use of a particular PDA. This then means the PDA have to send back an extra email and the consumer has to then respond with yet another email with their ID number, delaying the speed of resolving their matter.

ARE YOU WORKING WITH YOUR PDA?

KEEP COOL Debtfree magazine gets monthly emails from readers asking for help with their PDA or Debt Counsellor. Sadly, many consumers donâ&#x20AC;&#x2122;t know the name or contact number of which firm or even the PDA they are dealing with. Many mix up the role of the PDA with that of the Debt Counsellor. They may talk about their Debt Counsellor Hyphen (meaning their money is distributed via Hyphen PDA and they see it on their email or get a notification via SMS). This shows a huge gap in their knowledge and the initial training offered to them by their Debt Counsellor. Because your PDA will communicate with you via email or SMS they need to be informed promptly if you change phone numbers or get a new email address. If you forget to notify them of a change, you may suddenly stop getting updates and statements. You may then blame them but actually the fault is your own. Be sure to let both your Debt Counsellor and PDA know of any such changes.

When frustrated it is only human to get a bit hot under the collar. It can be frustrating to try explain a problem you are having to someone at the PDA via phone or email. It is important to remember to stay calm and respectful. They have hundreds of thousands of clients and want to help. Their job is to help. Shouting at them because of a communication disconnect or frustration caused by a credit provider will not help resolve the matter. Sadly, many PDA staff report being verbally abused by clients who are actually complaining about something that they have been told in error by a collections agent or because of a fault of their Debt Counsellor. Remember stress and anger are bad for your own health and will not make the person on the other end of the line like you more and want to help you faster.

DEBT REVIEW SCHOOL A PDA WILL NEVER CHANGE THEIR BANK DETAILS. IF SOMEONE PHONES YOU AND SAYS THEYâ&#x20AC;&#x2122;VE CHANGED THEIR BANK DETAILS CONTACT YOUR DEBT COUNSELLOR IMMEDIATELY BEFORE MAKING ANY PAYMENTS.

ARE YOU WORKING WITH YOUR PDA?

WORK WITH YOUR PDA Making use of a Payment Distribution Agency will make your life under debt review a lot easier to manage. They are an integral part of the National Credit Act and have to be registered with the National Credit Regulator - who audit them religiously. These firms can not only simplify your life but can prove very helpful down the line when tracking payments and handling disputes. But like so many other services it is never a good idea to take a totally â&#x20AC;&#x153;hands offâ&#x20AC;? approach. If you can put some of the advice of these PDASA members into action you will find that not only do you simply make use a PDA but that you will use their services to the full.

QUESTIONS FROM OUR READERS

I am under debt review but want to leave debt review and get a consolidation loan. What should I do?

If you need debt review then credit providers you apply to for a loan will quickly work out that you cannot afford to repay the amount of debt you have at a high interest rate (as most large “consolidation” loans have). Since it is illegal for them to give someone a loan they can’t repay or lend to someone under debt review, it is unlikely you could ever get such a loan. Debt review reduces debt and lowers interest rates. Making more debt is never a good solution by comparison. Rather, stick with your debt review and get rid of all your debt.

We offer back office services to Debt Counsellors including: 17.1, 17.2, Capturing CoBs, sending your proposals and helping handle court or NCT applications. Our full call centre and payment division can help you reduce your overheads and cut staff expenses. Cell: 083 232 1908 | Tel: 086 722 7405 | Email: elmarie@dcoperations.co.za

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ARE YOU READY FOR DECEMBER? The end of the year and Easter are traditionally months where consumers under debt review slip up and destroy all their hard work through debt review. Missed payments or even short payments quickly see unwary debt review consumers thrown back to the collections wolves and out of the protection offered by debt review. Cars are repossessed, homes sold on auction and debt balances sky rocket as the debt review falls away. So the question is: are you ready for December? Some simple steps will help protect you from making big mistakes that could see your family lose everything you have worked towards through debt review.

ARE YOU READY FOR DECEMBER?

BUDGET, BUDGET, BUDGET If you have been ignoring doing a monthly budget since you first entered debt review then now is the time to stop being lazy and actually figure out how you are going to cover all your December and January expenses. It is a long time between these two pay cheques and it would be wise to make sure you know exactly how much you will need for household expenses. This will also protect you from impulse December purchases.

ARE YOU READY FOR DECEMBER?

LET THEM KNOW! Let your Debt Counsellor and PDA know when you will get paid in December. You may want to ensure that your payment for your debt review goes off on the right date as some companies adjust their December pay dates. Get that money out of your account as soon as you can so that you donâ&#x20AC;&#x2122;t accidentally spend any of it.

ARE YOU READY FOR DECEMBER?

DON’T SPEND IT! If you did get a 13th cheque or Bonus what would you do with it? Now the harsh reality is that most will not get a bonus or 13th cheque as the failing economy makes this something of a dream. That said, for those that will get extra cash at the end of the year it might be wise to talk to your DC about how best to use this cash influx (large or small). Remember the DC has to ensure that your debt review is sustainable. This may involve settling a smaller account off in regard to end balance difference. It may involve covering those vehicle repairs you have been putting off. Your DC should have an intimate understanding of your total financial situation and not just your debt obligations. There is little benefit from trying to “hide” these funds from your DC since they will show you how best to use them (and yes, that could include having a little fun as well).

ARE YOU READY FOR DECEMBER?

TOP TIPS FOR SAVING Most important in December is your mind set. Others might be focused on spending and having fun at great financial expense. Obviously this is not possible if you are focused on eradicating your debts. Everyone needs some relaxation and you can find ways to do this without breaking the bank. If you get sucked into old habits of over spending in December however it might mean you find yourself unable to pay your monthly debt review repayment. If you miss a payment the debt review arrangement quickly falls apart. Debt review does not feature any payment holidays or the ability to short pay. It requires discipline and the right amount paid each month, every month. The following tips will get you in the right frame of mind!

ARE YOU READY FOR DECEMBER?

GIFTS Gifts are great but when under debt review you need to rethink the type of gifts you might give. Many parents like to spoil their kids for doing well in their exams, people love to give gifts during the religious holidays at the end of the year and travelling home to visit family may bring with it social pressure to bring lavish gifts home for everyone. The problem is that sometimes the family and friend can start to see us as a type of gift ATM or toy store, ready to bow to their every whim no matter the personal financial cost. Obviously, this is disrespectful towards us and shows a lack of care and affection. Our true friends and loving family should not be pressurising us into spending lots of money when we donâ&#x20AC;&#x2122;t have it available being trapped in debt. We may be part of the problem and may not have told our friends and family that things are tight financially. Well then our pride may be coming back to haunt us. It may be time to come clean and open up to friends and family about how we have set a goal of getting completely out of debt and how we are doing that.

Make a Gift Parents love it when their kids give them hand drawn pictures featuring somewhat deformed people and misshapen houses and stars. Who wouldnâ&#x20AC;&#x2122;t? It just goes to show it is the thought that counts. Of course, if you are able to make a nice, simple gift, that is of higher quality than a 5 year olds crude drawings, they will be even more impressed. Maybe it is time to break out those knitting or sowing skills to the benefit of others. Maybe it is time to get handy and use those pieces of wood that have been sitting around in the garage for ages.

Re-Gift The idea of parting with an item that you seldom, if ever, use is not a new one but with some polish and a bow you can hand over that old item as a new and exciting gift to others. The trick is to make sure you donâ&#x20AC;&#x2122;t give someone their own former gift to you back or be seen doing it in front of them. Awkward!

Be the Gift Consider doing things for people rather than giving things to people. You may have a skill that you are good at. Painting, mechanical repairs, handy man work, gardening or computer work. Why not offer your expertise to friends and family at no cost as a gift this year.

ARE YOU READY FOR DECEMBER?

FAMILY TIME It is often great to get to spend time with family after months of being apart. However it is also good to establish some ground rules before you get together. In the past, when you were spending frivolously everyone may have looked to you to generously cover all the costs on your expanding credit card debt. Things have now changed. It might be a good idea to discuss who will cover what costs before you head over for a visit. Do others in your family have more than you? It might be time for them to repay the favour this year and cover a bit more of the share than you do. If your family want to head off for a trip to the coast this year, discuss travelling together to reduce costs. Share with them exactly what you can budget towards accommodation costs as soon as possible so that no one books a place which is more pricey than you can afford.

Do the family want to come to your place? Why not suggest that you go to them this year (if close by) or that they bring groceries with them. Feel free to send them a list. Now is not the time to be shy. Learning to say no to your siblings or parents can be one of the hardest things debt review ever teaches you to do. It is always best to follow a hard â&#x20AC;&#x153;noâ&#x20AC;? with an alternative option so that they can see you are being reasonable and not just difficult. Get ahead of the problem by having these conversations as soon as possible.

DEBT REVIEW SCHOOL The person you regularly deal with at your debt counselling firm may not be your official Debt Counsellor. They may just work for the DC assisting them. Learn your DCâ&#x20AC;&#x2122;s name.

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U S I N G

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ARE YOU READY FOR DECEMBER?

SKIP THE TRIP If you have been in the habit of travelling for the holidays and find that to do so this year is going to break your budget then why not holiday at home. Now that may sound somewhat sad but if it matches your financial means then it is best to embrace it rather than mope your way through the entire holiday. There are simple ways you can make staying at home fun for yourself and the kids.

FUN FOOD

NO CLEANING

You can still eat affordably and eat somewhat more holiday food. Bulk buying some snacks ahead of time will help make snacks available for the kids all day long (All day? Yes, it is a naughty holiday)

No need to clean your roomâ&#x20AC;Śtoday Kids love to make a mess. Itâ&#x20AC;&#x2122;s almost a necessity. If you have a habit of chasing them to clean up all the time maybe let a few days go between cleanups to help the kids feel the difference in routine.

VISIT FRIENDS

NO CURFEW

Looking after the kids all day can leave you more exhausted at the end of the holiday than the start. Why not talk to the other parents and see if you can take turns to look after the kids, creating a little quiet time for yourselves on some days.

Holidays are all about the different and breaking a routine. Why not let the kids stay up a little later or out with their friends a little later to help create the holiday vibe.

BE SILLY

TO THE BEACH

It might be time to turn the lounge into a pillow fort and hide the TV inside. Play games with the kids. Take yourself for walks in the countryside or down at the beach.

Have you been promising yourself to work on your tan every year and yet each holiday slips by in a flurry of activity and you never get around to it. Well, some responsible sunbathing could have you the envy of all your friends this year.

READ A BOOK OR 10 BE LAZY Why not escape into the world of fiction this year if you are unable to travel. Ask your fiends what they are reading and borrow their books to keep costs down.

Normally we donâ&#x20AC;&#x2122;t advise on laziness in Debtfree magazine but the holidays are a time to kick back, grow your beard, let your hair down and recuperate. Help your family relax by not being too demanding and let everyone be a little lazy. Why not sleep late and move breakfast to 9am each day.

9 10 SKIP THE MOVIES SERIES BINGE Going to the movies is a huge expense. Between paying for parking, the ridiculous cost of the movies and the snacks you will soon find your whole holiday budget gone in one afternoon. Rather go down to Mr Video (they still exist) and get a R10 movie. Sometimes they even throw in the popcorn for free.

Ask your friends if they have any good TV shows they recommend. Join them at their place or borrow the shows and binge watch while eating ridiculous amounts of pop corn (itâ&#x20AC;&#x2122;s low fatâ&#x20AC;Ś some say no fat and quite affordable). You will be surprised how many of your friends went out in years past and bought DVD box sets of shows they never watched again. If you can find some ancient technology to play them on you can have a lot of no cost fun.

ARE YOU READY FOR DECEMBER? Get smart, get ready and donâ&#x20AC;&#x2122;t let December be the end of your debt review. Sometimes it takes a little planning to have a lot of fun. Try some of these tips to lighten the financial load this holiday season. Remember that December is just another step on your path to financial freedom. It is just a few days of the year. It can be a tricky one but if you donâ&#x20AC;&#x2122;t get swept up in the soon to come holiday frenzy, you will be able to enjoy a fun and stress free end of year.

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COURT MATTERS

HANS REINHARD PETTENBURGER-PERWALD // VOSLOO AND OTHERS

CONSENSUAL CHANGES TO INTEREST RATES IN A DEBT RESTRUCTURING COURT ORDER For a long time the Western Cape Courts have been struggling to decide what to do with debt review court applications where the credit providers have offered a new lower than contractual interest rate. This is something that commonly happens in a debt review as credit providers try to be nice and help their clients get out of debt sooner. They can even adjust the interest rates all the way down to zero percent in many cases. The challenge is that while it is possible for a credit provider and consumer to make adjustments to their contract (in terms of other sections of the NCA) the section about debt review court orders in the National Credit Act does not specifically say that this is something a court can just do without the credit providers consent. The courts are able to change what is paid monthly, extend how long it takes to pay and change when the payments

COURT MATTERS

have to happen but they cannot unilaterally just force a credit provider to change interest rates. The question then arose (and has been dealt with in recent cases like the Mars case) what happens when the courts are asked by the credit providers to change the interest rates in a debt review matter? Can they make such an order? Can they refuse to make the order just because they are unsure of what to do? This was the matter set before the Western Cape High Court in the case of Debt Counsellor Hans Reinhard Pettenburger-Perwald v Vosloo and Others (including Homechoice, Rainbow finance, RCS, Woolies, Standard Bank, Foschini, ABSA and African Bank). It related to a case which had gone to the CT Magistrates Court and been turned away due to the request to change interest rates. That case had referred to the infamous and often seemingly misinterpreted Nedbank v Jones ruling. Arguing the case at High Court for debt counselling firm Debt Therapy were Attorneys Quintin Zimmermann and Kim Armfield. Both are well known authorities in local Debt Counselling circles and big supporters of the industry.

THE RULING Judges Ndita and Holderness presided over the case and their ruling sets out a few important points that can serve to bolster related cases. The ruling talks a lot about the purpose of the National Credit Act and considers the intention of the legislature for consensual resolution of disputes and debt.

COURT MATTERS

The ruling finds that it could not have been the purpose of the legislature to prevent credit providers and consumers from reaching consensual new arrangements (like the interest rate charged). The ruling points out that changes to contracts is usual in business and in reasonable and responsible negotiations. Especially would this be the case where it is beneficial to both parties. The ruling states that Magistrates would not be acting ultra vires (outside of the scope of their jurisdiction and within the law) if they were to make such an order changing the interest rates by consent. The ruling also made mention of various industry guidelines and even NCR circulars (regarding DCRS and the Debt Review Task Team). While pointing out that they hold no legal power, they ruled that these circulars and task team findings do point to a lacuna in the NCA regarding consensual interest rate reductions.

OUTCOME The High Court ruled that the consumer was over indebted, put any ‘terminated’ accounts back into the debt review (in terms of NCA Sect 86(11)) and restructured the consumer’s debt obligations including the interest rate reductions agreed to by consent. RCS, Woolies and Foschini came out looking greedy with high interest rates that will probably lead to induplum caps while ABSA, Standard Bank and Rainbow Finance came out looking like the good guys trying to help their clients through interest rate reductions.

COURT MATTERS

DEBT REVIEW SCHOOL Your monthly debt review repayment will probably be done via a Payment Distribution Agency. Learn which PDA your DC likes to use. Learn their name. Ask if they are registered with the NCR.

For daily debt counselling news in 3 minutes or less visit www.debtfreedigi.co.za

NEWS

DCASA AGM

made to the constitution of the association, as well as the planned The Annual General Meeting (AGM) appointment of an auditor for the of the Debt Counsellors Association association. of South Africa (DCASA) was held in November 2017 at the Kempton Park Golf Club. AGMs are not generally NCR Quarterly Reports known to be fancy affairs but they do attend to some critical business, like In case you missed the deadline, updating members on the banking the NCR are waiting on Debt and accounts, as well as, giving Counsellorâ&#x20AC;&#x2122;s reports for the 1st of members the chance to vote for July till end of September 2017. The the National Executive Committee reports were due midway through (NEC) - who help organize the day November. Handing in these reports to day of the association. is obligatory for all registered Debt Counsellors even if they are not The AGM is also an opportunity to practicing. hear the President of the association (Mr Paul Slot in 2017) give a report on what the association has achieved NCT Visit to KZN during the last year and where the industry finds itself. The National Consumer Tribunal visited both the Western Cape and Then there is also the chance to look KZN in recent weeks with their forward to the next year and possible motion courts to hear debt review goals that need to be focused on. consent orders. Debt Counsellors This year there were some changes

NEWS attended and were able to submit applications where all parties were NCR After VW Financial Service happy with the proposal and had With More Creditors To Follow these granted. Applications to the Tribunal are much cheaper than The NCR recently issued BMW the normal fees associated with Financial Services with a compliance Magistrates courts. notice in regard to including what are commonly called â&#x20AC;&#x153;on the road feesâ&#x20AC;? into credit agreements with DReX is Live consumers purchasing cars. The long awaited information exchange system DReX opened up to use by Debt Counsellors this month. The system allows Debt Counsellors to interact directly with credit providers using the system. At present this means all credit providers whose debt review matters are handled by Consumer Friend. Debt Counsellors can log into the system and check correspondence, balances and draw statements. Consumer Friend are encouraging all Debt Counsellors to sign up for the system so that they can benefit from the speed of getting information electronically.

They soon followed with a similar compliance notice to VW Financial Services. The compliance notice tells these credit providers to stop adding these fees to credit agreements (since they are not mentioned in the National Credit Act or regulations as permissible fees). The notices also go so far as to say that the credit providers need to audit their books and give back the resultant fees and charges to all affected consumers since 2007 when the National Credit Act went into effect. The NCR have said that soon they will issue similar notices to all vehicle finance creditors (including the big banks) in this regard.

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NEWS It is expected that the credit providers will resist having to pay back the millions of Rand involved and that things will probably escalate to the National Consumer Tribunal.

National Treasury Budget Quits

Head

quit after interference by the Presidency. There is talk of a free education plan put forward by the President and Presidential hopeful’s (Mz Nkosazana Dlamini-Zuma) daughter’s boyfriend, who is commonly called the “son-in-law”.

Mr Morris Masutha’s proposal would obviously be a popular one among the all important young voters in The demand for free education has the years to come but the National been high for the last few years, with Treasury indicates that the plan is government policy being a slow and neither achievable nor sustainable. gradual stalling of any such process due to the obvious huge bill that Accusations in the press that the would come with it. President was trying to take direct control of the budget sent the Already the country is about R50 Rand into free fall for a while and Billion short of just covering its all the drama may prompt further existent budget and it seems downgrading by ratings agencies following the release of a report this week. on the topic, that the country would face another annual bill of around an additional R40 billion more.

Lewis Group Buy UFO

The Rand took a dip after Deputy Director-General Michael Sachs (who is the senior official in charge of the budget office) announced his resignation. He has apparently

Lewis Group, like all retail oriented credit providers, are looking for new clients to help bolster sales during the tough economic recession. In a bold

NEWS move, Lewis has announced that they have bought United Furniture Outlets (UFO), a high end furniture and homeware chain of stores. The chain has 30 stores and Lewis say they will now look to expand the number of stores both country wide and into other nearby African states. The deal is valued at R320 Million and ties in with the brands active push to sell to higher end clients and increase their cash to credit sales ratio.

For daily debt counselling news in 3 minutes or less visit www.debtfreedigi.co.za

DEBT REVIEW SCHOOL Find out exactly when your new debit order (for your debt repayments via the PDA) will be made so that you donâ&#x20AC;&#x2122;t panic when your new debt repayment is made for the first time.

Die Republiek van

SKYT AFRICA Haai daar Almal, Die jaar staan einde se kant toe en wat kan ‘n mens sê? Lank gelede toe Prins Charles en Lady Di geskei het, het Koningin Liesbet daar van Ingeland die woorde geuiter Annus horribilis leterlik vertaal uit Latyns beteken dit ‘n aaklige jaar. Nou wat ons die afgelope jaar hier in die Suiderpunt van Afrika ervaar het regverdig seker ‘n paar sterker woorde maar die jaar was definitief ‘n gatslag met ‘n groot rottang en dit was bleddie seer. Die voortslepende droogte in die Wes en Noord Kaap wat geen vinnige oplossing in sig het nie. Die verspoelings in Durban en omliggende gebiede. Die hael en windstorms in die Hoëveld. Beide van hierdie het groot finansiële skade veroorsaak. Moeder Natuur bly maar onvoorspelbaar! Werkloosheid bereik rekord hoogtes en dwelmmisbruik neem met rasseskrede toe. Bendegeweld ruk heeltemal handuit en onskuldiges boet hiervoor. Zama-zamas bloei die mynbedryf en ander kommoditeite dood met hulle wettelose bedrywighede. Wild en perlemoenstropery word deur

Mafiatipes vanuit die Ooste beheer. Kinder en vrouegeweld is ‘n teken van ‘n siek gemeenskap. Plaasaanvalle en moorde bereik ongekende vlakke. Dan is daar nog die daaglikse misdaad soos roof, kapings, inbrake, aanranding, verkragting en padwoede wat net aanhou. Ons is ‘n gelowige ou Volkie wat in die meeste gevalle van dag tot dag wil bestaan en in vrede aan die einde van die dag rustig met familie en vriende wil verkeer sonder dat ‘n doodse vrees op ons neerdaal. Die sosiale media, wat nou almal se beste vriend en kenner van alles is, oorheers ons denke. Dit is oorlaai van fop en valse berigte wat ons vir soetkoek opvreet en opsweep totdat emosies normale denke oorheers, dan wil ons saamstaan maar nie altyd vir rasionele en wel deurdagte redes nie, opsweep is aan die orde van die dag. Sport was nog altyd ons trots maar die Springbokke en Bafana se prestasies of eerder gebrek daaraan wil ‘n mens laat gryp vir vlugsout of miskien iets sterker. Op die politieke front is daar so ‘n magdom woelinge waarmee ‘n mens sukkel om tred te hou, magspeletjies wat seker niks positief vir ons as Jan Alleman inhou nie. Twee boeke het onlangs die lig gesien, The President’s Keepers deur Jacques Pauw en A Simple Man deur Ronnie Kasrils, ongelukkig is dit nie fiksie nie en daar is seker nog baie ander vergrype wat na vore gaan kom. SARS, SASSA, ESCOM, PRASA, SAL en menigte ander instellings is blootgelê. Die land se ekonomie raak net al meer onstabieler met die uiteinde ons as verbruikers gaan vir die gelag betaal. Tekorte van miljarde en verduistering en selfs diefstal van meer.

Die tekorte in die Staat se bankbalans kan nie voortduur nie en sal op een of ander gefinansier moet word, gaan die ‘n verhoging in persoonlike belasing of BTW beteken? Dit blyk of dit persoonlike belasting gaan wees maar daar is derduisende entreperneurs in die informele sektor wat nie belasing betaal nie en miskien kan BTW ‘n beter opsie wees. Welke een ookal ons gaan hoes vir hierdie tekorte. Die gedurige geblêr om instellings soos banke te nasionaliseer, grond onteien sonder vergoeding, skommelings van Ministers, bedanking en afdanking van senior amptenare wat korrupsie wil staak maak van die rand ‘n speelbal en ‘n verdere kredietafgradering is seker op die kaarte.

Annus horribilis die Koningin het nie ‘n clue gehad nie, ons beleef dit en mag dit tot ‘n einde kom!

Groetnis. Christo Hattingh Kyk gerus my LinkedIn profile: https://www.linkedin.com/in/christo-hattingh-351a52130/ * Seriously please do let us know if you found this article to be funny/offensive/amusing/interesting feedback@debtfreedigi.co.za

South Africaâ&#x20AC;&#x2122;s leading Debt Counsellors Click through to

www.creditmatters.co.za or call our national call centre on

086 111 6197

NCPDA2 REG. 2 00 8/01 874 1/0 7

TRANSPARENCY INTEGRITY COMPLIANCE

PAYMENT DISTRIBUTION AGENCY

COMPANY BACKGROUND On 28 August 2008, DC Partner began distributing funds newly appointed by the National Credit Regulator as a accredited Payment Distribution Agent. DC Partner’s business has continued to steadily grow ever since 2008 and is a financially strong company that strives for excellent service to our customers. DC Partner is one of only three NCR accredited PDA’s in South Africa and its operations are based out of the scenic town of George in the beautiful Southern Cape, with satellite offices in Pretoria and Cape Town. At present, the company employs roughly 100 people. DC Partner has a high level of commitment and quality control.

SECURE DI STRIBUTI ON OF DEBT REVIEW FUNDS DC Partner takes pride in providing accurate and timely distributions. After all, the ability to accurately and speedily distribute funds from consumers to credit providers forms the cornerstone of the debt review cycle. Distributions are strictly done according to the distribution plan provided by the relevant debt counselor.

WHY CHOOSE DC PARTNER AS PDA? A client relationship officer is assigned for EACH Debt Counsellor – Single point of contact & communication! We assist to follow up on default clients, unpaid funds and unidentified deposits. National representation – Frequent face to face visits to your office by skilled, trained agents. Automated e-mails which can be sent directly from our system – 17.1, 17.2, proposals, cascades etc. Systematized client statements for each distribution sent as e-mail or sms. Daily Distributions on all clients. 24 Hour access to our system (Including distribution data) from any PC, Cell Phone or tablet with internet access. Individual, dedicated business bank account for each debt counsellor. Multiple management review reports accessible directly to manage your debt review business and processes.

HEAD OFFICE: 59 VICTORIA STREET, GEORGE TEL: 044 873 4530 EMAIL: PDA@DCPARTNER.CO.ZA WWW.DCPARTNER.CO.ZA

MANAGING DIRECTOR T | 021 003 4535 INFO@MEERK AT.CO.ZA WWW.MEERK AT.CO.ZA

DAVID Oâ&#x20AC;&#x2122;BRIEN

Can you tell us a little about yourself (your background) and how you came to found Meerkat? I had been a product designer for Old Mutual for nearly 20 years, leading the team that delivered the Old Mutual products to the market. I felt that there was an opportunity for a business to be more client centric and to help customers do more with their money. Meerkat will deliver a range of simple new products to the market to fulfill that vision. The credit protection product offering is the first insurance product. We are keen to partner with debt counsellors to enhance the debt review process. We feel that there is an opportunity to add value through insurance expertise and enhanced DC support such as reporting etc.

Why do consumers need insurance cover while under debt review? The NCA allows Credit Providers to insist that the obligation is covered by credit life insurance, as a condition of the loan. Some credit providers persist with their credit life through the debt counselling process, some do not. This will cause uncertainty for the customer. Meerkat believes that insurance is important as it gives the client peace of mind that all their debts will be settled. This is especially important for â&#x20AC;&#x153;livingâ&#x20AC;? benefits, such as retrenchment or being diagnosed with an illness such as cancer. If the client is unable to meet the monthly payment, through illness, then the CPs will terminate the plan, and that will add to the problems of the already ill client.

PROFILE | DAVID Oâ&#x20AC;&#x2122;BRIEN | MEERK AT

What is Credit Protection and Life Cover? Life Cover is an insurance policy that pays out on your life. This might be for death, or a living benefit, as I said a moment ago. Credit Protection is an insurance policy that is linked to a loan. Most loans in South Africa are sold with credit protection insurance, and the customers are often not aware of the amount that they are paying, as they think it is just the loan repayment. If the customer is not aware of the product, then they will not benefit when they need it. Meerkat will proactively look for reasons to pay the claim.

Can debt review consumers afford it? Where do the funds come from? The Meerkat Credit Protection plan has been designed to replace existing credit life policies from the multiple credit providers that are involved in the debt review process. We generally find that the Meerkat premium is lower than the total of the existing credit provider premiums, and we can therefore save the customer money. We have a unique product and advice model that allows us to selectively replace the insurance products in the plan. Therefore, if the Meerkat product is not competitive, then we will leave the existing CP insurance in place.

If the product saves the consumer money each month what can be done with those funds? We see debt review as a step on the journey to financial wellness. The premium savings can go back into the customerâ&#x20AC;&#x2122;s plan. This can increase the likelihood of a DCRS solve, and can also reduce the time that the customer is under debt review. It can also be used to reduce the total monthly payment if the customer is particularly over indebted. The Debt Counsellor will control the process as to where to deploy any savings in the monthly plan.

Who is underwriting this product? Can consumers trust the product to pay out? The Meerkat Credit Protection plan is underwritten by Old Mutual Alternative Risk Transfer. Old Mutual has been paying customer claims for over 172 years. There is no more secure company in South Africa. Consumers often forget the importance of choosing a big company that will pay their claims. Some insurance companies have gone bust leaving consumers high and dry, and damaging the reputations and businesses of intermediaries and other stakeholders that were recommending the products.

PROFILE | DAVID Oâ&#x20AC;&#x2122;BRIEN | MEERK AT

Some credit providers complain that their in-house cover has the best benefits and donâ&#x20AC;&#x2122;t want to accept other cover. They say it is inferior. Will this be a problem with your product? The Meerkat product has been specifically designed to replace the full range of offerings from credit providers. We cover critical illness, compulsory unpaid leave, short time, as well as the more usual benefits like death, disability and retrenchment. We have an independent actuarial opinion confirming the superiority of the Meerkat benefits. Most credit providers are comfortable to accept

the Meerkat policy. We are still in discussions with some. We have also been discussing the industry dynamics with the FSB, the insurance regulator, and believe that the customer interests will win through.

What happens if consumers under debt review lose their jobs and canâ&#x20AC;&#x2122;t make their regular monthly debt review repayment? If the consumer has let the credit provider insurance lapse, then unfortunately the credit provider will pursue them and their family in the normal legal collections process. However, if the customer has the Meerkat credit protection plan and it is a valid retrenchment claim, then Meerkat will make the debt review payments for all the obligations that are covered, for up to 12 months, and the customer can enjoy peace of mind, and focus on finding employment. An important aspect for the DC, is that we pay the claim via Hyphen, thereby insuring that the Aftercare fees are also maintained.

What happens if a consumer under debt review gets injured and cannot earn income (for a short or longer time)? If the customer is injured and has a valid temporary disability claim, then Meerkat will pay their debt review obligations until they are able to return to work, or for up to 6 months. If the injury persists and the customer cannot return to work, then the disability is considered permanent, and then Meerkat will settle the outstanding obligations at that time. And, again, the DC continues to receive their Aftercare fees.

PROFILE | DAVID Oâ&#x20AC;&#x2122;BRIEN | MEERK AT

Is it easy to stay in touch and make claims for clients? Meerkat offers a dedicated call centre for customers. We can be accessed through email, telephone, whatsapp and live chat. We also offer an app, where the customer can submit their claim, and any required documentation. We also have a dedicated support model for debt counsellor partners, who can submit claims on behalf of clients, if required.

If a Debt Counsellor is not a FAIS complaint agent what can they do for their clients? The Meerkat team have collectively over 75 years of senior insurance expertise, it is our core skill. We believe that parts of the debt counselling industry are unknowingly creating significant insurance regulatory risk for themselves, through the inappropriate provision of advice from unregistered agents. Transgressions of the FAIS Act come with severe penalties for noncompliance. We have designed the Meerkat model to deal with this. Meerkat carries 100% of the insurance process, product and

END

Is it labour intensive to use your product? advice risk. We are an authorized FSP, and know the business and are comfortable with the risk. So, once we have an agreement in place with the DC, then all they do is follow a very simple one click process, and we do all the rest with the customer. his allows the DC to focus on their core business, while knowing that their clients have security.

We have spent a lot of time designing a simple model for all parties involved â&#x20AC;&#x201C; the DC, the customer, and the credit provider. We can get a DC up and running in 24 hours, if needed. We can also work in tandem with any insurance provider that the DC may already have, if the DC would like to explore alternatives.

DEBT COUNSELLORS ASSOCIATIONS ANNOUNCEMENT BOARD

Gauteng Branch Meeting 24 November 2017 @ 11:00 am - 2:30 pm Quick News Our AGM was held on 14 November. Check the member’s newsletter for details.

An open letter sent to Standard Bank: https://tinyurl.com/y7q343yr

DCASA is meeting with FNB in November 2017 to discuss issues and improvements pertaining to FNB’s Debt Review department.

www.dcasa.co.za

www.newera.org.za

We will not be holding any regional meetings till next year. Members are encouraged to start talking to clients about the end of the year and not missing payments.

This month we had 5 new requests from people wanting to join the member’s Facebook page. Members should feel free to post questions (and offer advice) on the members page. Remember we also have a public page (which we seldom update – we will try to put some new content up there for visitors soon).

www.bdcf.co.za

www.allprodc.org

DONâ&#x20AC;&#x2122;T WORK WITH AN OUT DATED VERSION OF THE ACT

UPDATED 2017

We are happy to announce that the Amended National Credit Act booklet is now available via our shop. Get the latest version for only R250.00

ORDER NOW http://debtfreedigi.co.za/product/pocket-sized-national-credit-act-booklet/

DEBT COUNSELLING COMMUNITY SUPPORT

BACK TO SCHOOL For most parents, Januaryâ&#x20AC;&#x2122;s back to school costs are far away and their focus is simply on making it to the end of the year. But families in debt review need to be more prudent and plan better than most families. When a family enter debt review and switch to a cash lifestyle they need to get wise about saving toward upcoming costs since they cannot simply put purchases on their credit cards as many do. But what happens when there just are not enough funds to take care of extra costs even if you are in debt review?

Contact admin@dccsupport.co.za

Debt Counselling Comunity Support have over the last few years been able to help vulnerable debt review families get through this tricky part of the year with help from generous industry sponsors. Debt Counsellors, attorneys, PDAs and credit providers have all clubbed together to help out those deserving hard working, loyally paying consumers under debt review who are feeling the pressure. Once again this year DCCS will be launching an end of year drive to get supplies ready for the January Back to School drive. Vouchers and bags full of clothing or stationery will be provided for those families identified by Debt Counsellors in the community. If you know of any families who might qualify then please contact admin@dccsupport.co.za

Sponsor a R150 Back to School Hamper

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