Every month you receive a statement from your credit provider explaining how they’ve calculated your next instalment and informing you of your remaining balance.
But what if they’re charging you more than they should? We found out what you should do if you suspect you’re being overcharged.
Tip: Find out whether you qualify for credit by checking your credit score here.
Speak up if something seems wrong
According to Olebogeng Nong, property investor and consultant at Nong Wealth Property, the National Credit Act (NCA) is your first recourse in the event of incorrect or unfair credit agreements.
“They do this by laying out the maximum service fees that may be charged on credit agreements. Therefore, you can dispute an unlawful fee that was charged by your credit provider,” says Nong.
You should first approach your creditor regarding the discrepancy. There may be a reason for the fee change, or it may simply be an error they’re happy to fix.
However, Nong explains that if they don’t resolve the issue, you may take the dispute to the National Credit Regulator, which acts as the protector of consumers in regards to unauthorised credit transactions.
“It’s your responsibility to know your rights in relation to how the national legal framework protects you in terms of the highest interest being potentially charged,” says Nong.
He recommends that you constantly monitor your credit habits and credit status by using reputable credit monitoring systems, which will indicate your monthly progress towards your credit goals. For example, you can check your credit score here.
READ MORE: 9 Common finance terms you should understand
Know the limits for fees
Nong says that in South Africa there are regulations enforced which limit monthly insurance fees. He outlines the maximum amounts you can be charged for bonds and credit life cover:
- An ordinary bond agreement is limited to R2 for each R1,000 owed by the consumer.
- Credit life cover is limited to R4.50 for every R1,000 owed by the consumer. This applies to all credit, excluding mortgages.
He adds that you are also protected if you have concerns regarding agreements you have with your bank, or any disputes you may have with credit bureaus. He suggests calling these institutions:
- For complaints that are related to banks, you can contact the Ombudsman for Banking Services on 0860 800 900.
- For matters relating to the credit bureau or credit bureau information issues, you can contact the Credit Information Ombudsman on 0861 662 837.
If you’re struggling to keep up with your monthly instalments, find out more about debt counselling.