Credit Reporting: What You Should Know About Consumer Rights for Loans in South Africa

July 18, 2019

Your credit record is important. It serves as your financial reputation on paper. One look at it will tell others all they need to know about your spending habits and any transactions you made. Depending on whether it’s good or bad, your credit record can open or close the door to financial opportunities in the future. 

In South Africa, for instance, there are approximately 21 million credit-active individuals. The sad part is half of them are actually people with bad credit. Now, the question is, are you one of them? If you’re not sure, you should get in touch with the credit bureaus, namely CompuScan, Xpert Decision Systems, TransUnion and Experian. Ask for a copy of your credit report.

But here’s the thing: aside from obtaining a copy of your credit report, you should be aware of your rights when it comes to credit reporting. That said, here’s what you should know about consumer rights:

The Right to be Informed

When it comes to information, you are entitled to a loan agreement and quotation. For instance, when you’re applying for a loan, the lender or financial institution you approached should give you a quotation and loan agreement prior to approving your application. The idea here is to ensure that you are properly informed. You should know what you’re getting yourself into, particularly when it has something to do with your finances.

The Right to Choose

Most lenders such as banks and other financial institutions do provide quotations without asking for an outright commitment. This is because every consumer has the right to choose. You can freely get quotes from various lenders, compare the terms of each, and decide which one to choose. Once decided, you can seal the deal with a lender and commit to your financial obligations.

The Right to be Heard

Every consumer has the right to be heard. Just because you are indebted, you can no longer speak up or complain, and all you need to do is to comply. Consumers are protected from aggressive lenders. When they are unable to pay, they can seek payment arrangements with lenders. Should there be errors in credit reporting, they can dispute these errors verbally or in writing. Credit providers should acknowledge and respond accordingly.

The Right to Take Action

Every consumer has the right to redress and correct matters in cases when he’s been wronged by credit providers, lenders or other financial institutions. All you need to do is to contact the National Credit Regulator for valuable advice or appropriate resolutions to any disputes.

The Right to be Educated

Finally, every consumer has the right to be educated. It is the responsibility of every credit provider or lender to educate its customers or clients. As a consumer, you ought to get yourself educated as well. Learn as much as you can about getting into financial matters, making transactions, your obligations, and getting reported to credit bureaus.

Final Words

In the end, it is in your best interest to find out about your rights and options as a consumer. It is essential that you are informed about your credit standing and that you obtain a copy of your credit report. All these are crucial to your current and future financial endeavours.