A number of retailers are taking the National Credit Regulator (NCR) to court with the aim of having parts of the affordability assessment criteria declared unlawful and constitutionally invalid. It is understood that the retailers involved include MR Price Group, The Foschini Group and Truworths.
Changes to the National Credit Act (NCA) were made earlier this year, to protect consumers from taking out credit that they could not afford. These amendments included improvements to the affordability assessments carried out by creditors, such as retailers.
Lesiba Mashapa, Company Secretary at the NCR, confirmed: “The retailers are challenging the income verification parts of the affordability assessment regulations. The NCR and DTI (Department of Trade and Industry) are opposing the retailers’ application. The retailers are Foschini, Mr Price and Truworths.”
If the retailers succeed, it could mean that consumers may have easier access to credit in the form of store cards, and possibly other lines of credit. However, in a time when money is tight and many people are feeling the effects of the country’s weak economy and the impact of the drought, this may not be a good thing.
The MR Price Group had no comment at the time of publication. Truworths failed to submit commentary in time for publication.
The Foschini Group was contacted several times, but failed to respond to requests for comment at the time of publication.
