The National Credit Regulator (NCR) received 1 646 complaints from the public, mostly about interest rates or debt counselling, between April last year and March this year, according to the regulator's latest annual report, tabled in Parliament last week.
Of the total complaints received, 1 379, or 84 percent, were resolved.
Gabriel Davel, the chief executive of the NCR, says his office is committed to ensuring that it will take a maximum of 90 days to resolve a complaint. Of the 1 379 complaints that were resolved, about 72 percent were resolved within 30 days, 21 percent within 60 days, five percent within 90 days and one percent was resolved after 90 days.
The report says the resolution of the complaints resulted in R292 073 being refunded to consumers and in consumers' outstanding loan account balances being adjusted in their favour to the tune of R554 722.
During the year, the report says the NCR conducted 99 investigations into a range of credit market participants, including 31 debt counsellors, 41 micro-lenders or pawn-brokers, nine retailers, nine companies that grant home loans, seven banks and two bridging finance institutions.
These investigations included reverse mortgage schemes, where consumers are at risk of losing their homes after unwittingly signing them over to credit providers.
Debt counsellors were investigated for not adhering to the prescribed time limits for drawing up a repayment plan and submitting it to creditors, and for charging excessive fees.
Payment distribution agencies were in some cases found to have not made consumers' debt repayments to credit providers.
Credit providers were investigated for charging excessive rates of interest and for splitting loans to take advantage of exemptions that permit higher interest rates to be charged.
Credit providers were also investigated for retaining consumers' bank cards, savings books, pension cards and identity documents.
Peter Setou, the NCR's senior manager of education, says that to date 115 539 consumers have applied for debt counselling. Setou says only 6 616 cases have been processed by the courts. Cases are referred to court if a creditor disagrees with the repayment plan drawn up by the debt counsellor.
Debt counselling was introduced as a relief measure for consumers who are over-indebted. If you are over-indebted, you can approach an accredited debt counsellor, who will help you draw up a budget and devise a repayment plan that will allow you to meet your living expenses.
In March this year, there were 834 registered debt counsellors and eight institutions accredited to train debt counsellors. These institutions are the Association of University Legal Aid Institutions, Damelin, Institute of Bankers, Rudo Research and Training, The Credit Skills Training Institute, Cornerstone Performance Solutions, Summit Financial Partners, and You and Your Money.
Of the 834 registered counsellors, 168 were debt counsellors who manage their own businesses other than debt counselling, 135 were full-time debt counsellors, were attorneys, 71 were accountants, 27 were financial planners and 29 were estate agents.
The annual report shows that of the 834 debt counsellors registered in March this year, 22 percent had degrees, 36 percent had diplomas and 42 percent had a matric qualification.
Research commissioned by the NCR and published last week states that some debt counsellors produce unacceptable debt restructuring proposals. The research report goes on to say that "these ill-informed proposals point to a lack of education, experience and competence on the part of some counsellors".
Setou says there are currently 1 257 registered debt counsellors.