NCR urges South Africans to borrow money wisely
The National Credit Regulator has urged South Africans to borrow money to take care of January expenses only if it is absolutely necessary.
This, as schools, re-open on Wednesday, with many requiring money to take care of fees, uniforms and transport.
The NCR's lebogang Selibi says consumers are further advised to be cautious of unregistered credit providers and only borrow money from NCR registered service providers.
READ: 0% matric pass rate for three KZN schools
"We have seen the trends, and we know that some people will need to go and borrow, rather borrow wisely and only borrow from people that are registered with the National Credit Regulator".
"With our stats, it shows that our spending patterns increase, we tend to take out more credit in the festive season and in the January to March quarter. The way that we take out credit goes down a bit, so if you didn't spend wisely in the festive season it's going to impact on your finances the new year," she said.
READ: Higher Education warns of bogus colleges
Below are helpful tips that the NCR offers to consumers when borrowing money:
- Never ever agree to pay any upfront costs / fees – Many consumers are duped into paying upfront fees labelled as “admin fees”, “lawyer’s fees”, “release fees” etc. When borrowing money from unscrupulous/fake/unlawful entities usually found online. In most cases, consumers lose their money (upfront payment) without getting any of the money they have borrowed.
- Borrow only when it is absolutely necessary to do so and avoid borrowing money for consumables such as groceries.
- Do not sign a blank credit agreement/document, read the content first, understand, ask relevant questions and when satisfied sign.
- Consider credit insurance - Familiarise yourself with the terms of the credit insurance to avoid surprises when you most need the cover from the insurance. Credit insurance can be a life saver when you cannot repay the debt for reasons such as unemployment, disability and others.
- Pay your debts on time - Paying late or not paying the full installment will adversely/negatively affect your credit rating and possibly your ability to take out credit in the future. If you think you cannot meet your monthly instalments, contact your credit provider immediately and try to re-arrange payments. Do not wait until you skip payments.
- Create a monthly budget and stick to it.
- Check your credit report regularly.
